I live in Rhode Island and have
a 500 dollars down payment, will that be enough for a car I want
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Will a down payment of $500 get me the car I need
Island? That is a question that many people in our fine state
have asked themselves over and over in recent years. I suppose
the quick answer is a big resounding YES, depending on your credit
rating. To quote William Shakespeare, "therein lies the rub".
Many people, who have only $500 down, do not have a stellar credit
history. If they did, they probably would not need ANY money down.
Here are some strategies that one can apply to secure an automobile
with $500 down without a great credit history. You can start by
seeking out dealers who specialize in this type of financing.
Many of these dealers are "buy
here pay here" dealers. There are certain advantages
and disadvantages of pursuing this approach. The most specific
advantage is obvious
.these dealers do not rely on credit
bureau reports to make decisions about getting you into a vehicle.
That is a life saver to most people. After all, the reason why
you are visiting this dealer in the first place, is because you
aren't conventionally credit- worthy. Many of these dealers will
finance the vehicle "in-house",
and that is what you want. Oftentimes, the only requirement these
dealers demand is that you have a job. Other determining factors
are, how long you have been at your job, and how long you have
lived in your current residence. These are prime indicators of
stability and demonstrate to your dealer that you will pay them.
Another advantage is, that many of these dealers will tailor a
payment plan that you can handle comfortably. No dealer is interested
in making someone pay more money at payment time than they can
afford. That would only cause you to default and the dealer to
repossess the vehicle. A dealer is not interested in repossessing
a vehicle that they have readied for delivery. Another decided
advantage is that, in Rhode Island, a dealer is obligated to provide
the consumer with a safe and sound vehicle. One that is safety
tested and is, in many cases, warranteed. That safety net for
the consumer is mandated by Rhode Island state law. In Rhode Island,
there is also a state funded watchdog commission where a customer
can lodge a complaint and get a hearing to air their grievance
in front of a panel of people. This process doesn't cost the consumer
any money, and decisions are often rendered with the consumer
in mind. In other words, if there is any doubt, the panel decides
in favor of the consumer.
There are also a number of disadvantages of acquiring a vehicle
from a dealer who finances in house. One, that many people have
a real problem getting by, is that the dealer, in many cases,
decides which vehicle THEY will allow the consumer to drive away
with. However, temper your desire with your need. Life is all
about compromise, and if you have put yourself in a tough financial
spot, this may be your only chance to acquire a drivable roadworthy
vehicle. Keep in mind that the dealer is trusting you to pay them
after you have not been such a reliable risk. This comes with
consequences. One of these is lack of choice during the buying
process. Remember though, that many dealers will allow you to
upgrade to the vehicle of your choice, if your payments to them
are timely. Another significant disadvantage is PRICE! You are
going to pay dramatically more for your purchase. That is how
Island dealers make their money. These dealers can charge
whatever they want. Believe this one fact , if you do not believe
..you will pay more money for a vehicle that,
if you were credit worthy, you wouldn't pay nearly as much for.
Just another one of those pesky consequences but, I'm sure you
knew this. I'm not trying to lecture anyone here, I'm just trying
to explain certain truths about the buy here pay here avenue of
vehicle acquisition. Another downside is that it's very difficult
to break from this contract once you agree to enter into it. It's
often hard to save for a down payment on a more substantial, less
expensive purchase, because of your current payment obligations.
You could be in a cycle of buying from this dealer for many years,
and that is exactly what the dealer wants. Reliable customers
who buy at high prices are the lifeblood of any business.
So, weigh these pros and con very carefully. Above all, do not
put yourself in an even more difficult position by biting off
more than you can chew. Remember, ask a lot of questions, do your
homework, and know your rights. Arm yourself with knowledge and
your buying experience doesn't have to be drudgery
actually be a positive!
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