Buying a Used Car in Houston? Here's the Difference Between In-house Financing and Regular Financing
Whether for convenience or to save yourself the hassle and time of commuting, many people are buying preloved cars nowadays, especially with the price of new vehicles rising almost every minute.
However, even if you want to buy used cars in Houston, there may be instances when your financial situation doesn't allow you to purchase them upfront. When buying used cars in Houston, understanding and using the right financing is vital to making the right decision for your current financial situation.
Can I Buy a Used Car with Financing?
Buying a car can be expensive, whether secondhand cars in Houston or bright shiny new ones. So, if you’re wondering if you can buy a preloved vehicle with some help from a financing arrangement, the answer is yes.
Financing means getting a loan so that you can buy a car according to terms that are easier and more convenient than paying a lump sum of cash.
Understanding Your Two Financing Options when Buying Used Cars in Houston
Financing is a great way to make your purchases more manageable by allowing you to spread the cost of the car over a period, allowing you to budget your money better. Generally, you have two financing options when buying preloved cars: in-house financing and regular financing.
1. In-house Financing
If you want something quick and easy, then in-house financing might be your best option. Unlike banks, used car dealerships in Houston, TX, streamline the process and have more lenient requirements.
This is because you get the loan directly from used car dealerships in Houston, TX, and because of this, they often offer various benefits, such as low to zero down-payment options. However, these freebies come at a cost, as dealerships provide a higher interest rate than banks.
How It Works:
You choose the car of your choice from the dealership’s inventory
Fill out the loan application, and they will review your credit history. Many dealerships are used to applicants having low credit scores.
If approved, the dealership will set the terms and conditions of the loan, often having a higher interest rate. Payments are usually required weekly or bi-weekly.
After discussing the terms and paying the down payment, you can immediately take the car and leave.
Note: The dealership can repossess the car if you miss multiple payments
Pros of In-house Financing:
Cons of In-house Financing:
Higher interest rates
Limited car selection
Risk of repossession
2. Regular Financing
Regarding regular financing, you get your loan from the bank, a credit union, or other financial institutions. Regular financing might be the right option if you have a good credit score since you can shop around for better loan conditions and low interest rates.
However, because of banks’ conservative nature, it takes time for loans to be approved since they perform thorough credit assessments.
How It Works:
After shopping for a car you like from any shop or brand, you apply for a loan through a bank, credit union, or other lending groups.
The lender will then review and evaluate your credit score, make a risk assessment, and determine other financial factors if you can take a loan.
If approved, they will then provide the loan, and after paying the down payment, the lender will be the one to pay the dealership directly for the car.
Pros of Regular Financing:
Cons of Regular Financing:
Where to Buy Used Cars in Houston, TX?
Houston is filled with shops where you can buy used cars. However, if you want used car dealerships in Houston, TX, that offer a wide array of quality used cars at a reasonable price, Drive Nation Auto is the place for you.
Drive Nation Auto offers a seamless car-buying experience with various car financing options that will fit your every need, including lease returns and car trades.
If you still need to figure it out, fear not, as Drive Nation Auto offers in-house financing options for those with low credit scores. Additionally, if you buy a car from Drive Nation Auto, they'll report it, helping you get a better credit score.
Final Thoughts on Auto Financing Options
Owning a car has become necessary in today's fast-paced world; however, not everyone can buy a new one. As such, many people have turned to used car dealerships in Houston, TX, to get their fix. Even more so since the introduction of car financing in the market.
Whether you use in-house or regular financing, understanding both is one step closer to a better buying experience.
However, suppose you want a used car dealership in Houston, TX, that offers a wide selection of quality vehicles and caters to both financing options. In that case, Drive Nation Auto is the one for you. Whether you visit our virtual showroom or drive down by, contact us today and find a car for you and apply for auto financing from us.
