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Bad Credit Car Dealers

June 25th, 2012

I was thinking about all of the people that I talk to that need a car, and I wanted to write some of the most common reasons why people either give their car back to the dealership, or have the dealership repossess it.

The first reason and the one that I hear the most is that of a car breaking down. I can't tell you how many people I speak to looking for another car have bought a car from a dealership that sold them a car that had problems when they bought it with a promise to fix it, or a car that developed severe problems very quickly. At the point where the cost of a new engine is going to run $3000 - $4000, there is really nothing that can be done if the car does not have a warranty. Make sure that if you are looking for a car, you only finance if it has some type of warranty. Even if it is just for 5000 miles, at least you will know if there is a problem with the car right away. Make sure that when you are searching for a car one of your primary considerations should be a warranty.

The second reason is that the car payment was too high, or the terms of the deal were not explained in a way that could be understood. It is very important to not sign any contract until you fully understand exactly what you are going to be paying, not only monthly but the total amount you will pay over the course of the loan. Also make sure that you are comfortable with the interest rate, which in buy here pay here dealerships is usually quite a bit higher than an interest rate if you have perfect credit. If you are interested in a car also make sure that it is in your budget and that you can afford to make the monthly payment. It is one thing to fall in love with a car and buy it on the spot, and another to struggle month after month to make the monthly payment. Most buy here pay here dealers have clauses in the contract that state if you are 1 day late on your payment then they will repossess the vehicle. Make sure that you can comfortably make the monthly payment before you buy any vehicle.

The third reason is losing a job or a medical condition. This is unfortunate because the last thing that you want to deal with is the thought of losing your car when you have just lost your job or are laid up in a hospital. If at all possible try to keep a savings for at least 1 month so if a situation like this arises at least you have some time to get back on your feet, and you have a car still so you don't have to go through the process of buying a car all over again.