rent to own car lot, BHPH dealership

Purchasing a Car from a Rent to Own Lot

All too often, we encounter people with bad credit who haven’t been able to meet the requirements for a subprime auto loan. However, being turned down for a car loan doesn’t change the fact that these consumers still need a vehicle. When this happens these buyers will often turn to renting a vehicle.

In these situations, SLG Progressive + Commercial Insurance Agency often receives questions asking for more info about rent-to-own options. Take this customer, for example:

“I am in need of a loan for a car… would you direct me to the car lot that will let me pay weekly to own my own car… [Renting] has killed my bank account. However I need a car to continue to work!”

What Rent to Own Means

Rent-to-own car lots are just another name for Buy Here Pay Here (BHPH) dealerships. These dealers provide financing for an auto loan themselves—they don’t rely on indirect lenders. For this reason, they’re often referred to as in-house financiers.

If you have very bad credit, or even no credit, it can often be easier to obtain financing through a BHPH car lot. In most cases, these dealers don’t check your credit, which can be to your advantage if credit issues have gotten you turned down for a traditional or subprime auto loan.

An auto loan can be a wonderful tool for improving your credit if the dealer reports the loan and your payments to the national credit bureaus. Be aware, however, that not all rent-to-own or BHPH lots will do this. This may be especially true if the dealer doesn’t require a credit check.

What You Need to Rent to Own

So, if a buy here pay here car dealer doesn’t check credit, what does it take to purchase a car from one? Above all, the most important thing they’re looking at is your income. A steady income is the key to purchasing a vehicle from a BHPH dealer, and it’s worth noting that you’ll typically have to pay them weekly or bi-weekly—often in cash at the dealership.

Another important fact is that when you rent to own or lease to own a vehicle, you will always be required to make a down payment. The amount you’ll be required to pay upfront will vary. It’s likely to be dependent on the vehicle you choose, as well as the dealer’s investment in it.

Be Sure this is Your Best Option

Buy here pay here dealers can be an option for customers who need a used vehicle right away and are willing to pay more to get it. Rent-to-own cars tend to be higher mileage, older used cars (sold as is) that typically don’t carry a warranty. As with any used vehicle, it’s a good idea to have the car inspected by an ASE-certified mechanic.

Sometimes, it’s easy to feel like you have nowhere left to turn when you’re in need of a car. At SLG Progressive + Commercial Insurance Agency, we understand the difficulties of getting an auto loan when you have bad credit, and we want you to know there are options beyond rent to own.

We work with a nationwide network of special finance car dealers who offer a wide range of vehicle options for people with bad credit. These dealers have the lending resources available to assist people with many types of credit challenges. Let us help point you toward a dealer in your area. Simply fill out our no-obligation auto loan request form to get started today!

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