5 Benefits of On-the-Lot Car Financing

On-the-lot car financing dealerships seem to be popping up everywhere, but they’re not a new concept. On-the-lot financing dealerships have been around since the savings and loan crisis of the early 1980s. During that period, there was intense scrutiny on the lending practices not only of savings and loans but of other financial institutions as well. Loan rates sky-rocketed as available cash for loans decreased, making it difficult for the average consumer to get a loan and make payments on the purchase.

On-the-Lot Car FinancingOn-the-lot financing dealerships were started because dealers still needed to sell cars. That is their business, after all. And consumers still needed reliable transportation to get to work. Some auto dealerships decided that the best way to sell cars was to handle the financing themselves. That way, they could loan to people who seemed like a reasonable risk, without the customer having to go through the rigorous vetting process required by banks and other lending institutions. Thus, a new industry was born.

Okay, so what does this have to do anything?

What we’re saying here is that on-the-lot car financing isn’t new. It’s a legit business and can be an excellent option for people who are strapped for cash or have bad credit. Many of these on-the-lot financing dealerships sell only used vehicles. There’s a reason for that. Used vehicles cost less. So for someone who struggles to accumulate large sums of cash for a down payment, shopping for a vehicle that costs less to begin with makes sense.

Here are 5 benefits of on-the-lot car financing.

To help you understand why on-the-lot car financing might be a good option for you, here are 5 benefits to consider before you go car shopping.

#1: It’s easier to qualify for a loan.

Most on-the-lot financing dealerships make it quick and easy for customers to qualify for a loan. Because the dealerships take on the risk of loaning you money, they have the flexibility to set their own lending guidelines. Many of these dealerships have an online application that gives you an answer in just a few minutes - sometimes within five minutes or less! This gives you the confidence to walk into the dealership and start looking for a car, knowing that you’ll be able to get a loan for it.

#2: You get more flexibility on your trade-in.

If you have an old car, on-the-lot financing dealerships may be willing to give you a better deal on the trade. Because they set the terms of your loan in-house, they also have the flexibility to offer you more on your trade-in if it helps strike the deal. This is a benefit you don’t get at a traditional car dealership. There you’ll typically get an inflexible “take it or leave it” attitude that’s not conducive to you getting the full value of your trade-in.

#3: You get financing regardless of your past credit history.

People who’ve had credit challenges in the past are often stressed out and fearful when it comes to car shopping because they’re afraid they won’t be able to get a loan. And who has the cash to pay for a car up front? Most on-the-lot financing dealerships don’t care about past credit challenges. They don’t even pull a credit report or look at your credit score. Their main focus is on your future earnings potential and whether you can make your payments every month. You will have to prove to the finance team that you have a job, and you’ll have to tell them how much you make. But they use that information to help structure a deal with payments that fit within your budget.

#4: Getting on-the-lot car financing can actually help your credit score.

Working with an on-the-lot financing dealership can actually improve your credit score when you make your monthly payments in full on time, every time. Many on-the-lot financing dealerships will report your on-time payments to one or more of the top consumer credit reporting agencies. This goes on your record and shows that you’re a financially responsible person who can be trusted with a loan. Over time, your payments help boost your credit score, and before you know it, you’ll be back in the black.

#5: Many on-the-lot financing dealerships are run by good people who really do want to help.

While there are bad apples in every basket, you’ll often find that the people who own and operate on-the-lot financing dealerships are good people with compassionate hearts. In fact, many of these businesses were started specifically to help fill a need: the need people with bad credit have to be able to purchase safe, reliable transportation. In many cities across the country, having a good set of wheels isn’t just a “want-to.” Having a reliable vehicle is a must, but for people who’ve fallen on hard times, had a streak of bad luck, or have made a few poor decisions in their day, buying a car can be difficult. Working with an on-the-lot financing dealership that cares about getting you into something you can afford alleviates stress and makes the car-buying process doable.

Here’s a recommendation for on-the-lot car financing in North Carolina: AutoMax.

If you have bad credit and need new wheels, go to AutoMax. They have two locations - in Henderson and in Youngsville - and have been serving these cities, as well as the Raleigh-Durham metropolitan area since 1989. The company was started by two guys who realized that people with bad credit had a hard time getting traditional loans. They decided to help by making used vehicles affordable through on-the-lot car financing.

When you visit AutoMax, you’ll find friendly, caring people who genuinely want to help. They work with your current financial situation to make sure you get into a vehicle that’s right for you - one with payments that fit within your budget. They’re not interested in making your situation worse by tacking on extra fees or requiring a large down payment. They’ll work with you to put together a deal you can live with. You’ll soon be driving a new set of wheels!

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