1803 Brighton Pl Pittsburgh, PA 15212 412-315-7986

Seven Questions: Do I Need A Used Car Warranty?

     Do I need to get an extended warranty on a used car? There are two schools of thought on this. If you’re asking around family and friends about used car warranties you’re likely to get one of two different answers argued just as passionately as politics.  One will tell you that warranties are a scam. Another will tell you that anyone who doesn’t protect the large investment they just made would have to be crazy. Who’s right? When looking at the overall picture, it may be that they’re both right.

     Extended warranties are basically a type of insurance. The word insurance can confuse some people since most generally associate insurance with liability and collision. Your regular insurance that you’re required to purchase in order to drive legally covers damages that happen in the course of an accident or theft only. What about everything else? That’s on you, unless you’ve purchased an extended warranty. Warranty companies are businesses just like insurance companies. They are in the business to profit and if warranty contracts weren’t profitable for the company, the company would soon stop selling contracts. Warranty companies profit the same way other insurance companies profit. They are basically betting that you will pay for your contract but not use it. If you can figure out the way they “hedge” their bets, you can ensure that you are purchasing a contract for a vehicle that actually needs it.

     If you go into a dealership today, they will be able to price a warranty for you by only knowing the vehicle you want to purchase. Unlike insurance, who is driving the vehicle is irrelevant. That’s because they base their risk on the vehicle and its reliability. Purchasing an extended warranty for your newly purchased used vehicle is a smart choice in some situations and unnecessary in others. How do you know which situation you are in? Answer the following questions to find out if a warranty is a good idea.

 

Question 1 Did you spend the majority of your disposable income purchasing the used car?

If you spent most of your money just purchasing the vehicle, a warranty might be a good idea until you get your cash back up. When you just purchased the vehicle and are low on funds, a breakdown could be catastrophic financially. People left without disposable cash after purchase would have a more difficult time digging themselves out of a breakdown.


Question 2

Did you pay a significant amount for your vehicle?

If you purchased a more expensive vehicle, then spending a little more to protect a large investment is probably a good idea. Losing your investment on a $3,000 used car with a blown engine isn’t nearly as financially damaging as losing your investment on used car that you just spent $18,000 to purchase.

 

Question 3

Are you in a jam if your vehicle breaks down?

If you do experience a breakdown and need to get a car repaired yourself, do you have a way back and forth to work or for other important personal travel? If not, a warranty may be a good idea.

 

Question 4

Does your used car have a lower reliability rating than other models?

Warranty companies sell service contract to make profits. That’s what they’re supposed to do. By knowing how they calculate their own risk, you can get a better idea of whether or not you need the warranty.  Warranty companies separate vehicle makes and models into classes. Those classes are based on the reliability of the model. Less reliable brands like Mercedes-Benz, BMW, Dodge and Chrysler will be in one class and that service plan will be more expensive. Brands known for reliability like Honda, Subaru or Toyota will be in the lowest or highest class respectively and be less expensive. A great way to figure out if you need a warranty is to look at what class your vehicle is to the warranty company you are about to purchase from. If the warranty is more expensive, and it’s in the warranty companies highest or lowest class, there’s probably a better chance of breakdown. Edmunds offers a great reliability rating tool on their site here.

 

Question 5

Is the vehicle you are purchasing an older car with higher miles?

Warranty companies also consider mileage and age. A newer vehicle with lower miles will be less to protect. This is obviously because lower mileage and newer vehicles are less likely to break down. If the vehicle you are purchasing has more miles than most or is older than most, it’s probably a good idea to get a warranty.

 

Question 6

Is your used car a luxury brand?

Luxury brands have more complicated problems and part and service cost exponentially more than other makes. It can be difficult for owners of some luxury brands to even find a shop that repairs them. They’re also more expensive warranties to purchase. If you don’t have a few thousand dollars laying around and are purchasing a luxury vehicle, it’s probably a good idea to get a warranty.

 

Question 7

Is peace of mind more important to you than saving money up front?

This is a question only you can answer. By forgoing an extended warranty, you are basically betting (just like the warranty companies) that your vehicle won’t break down or that it would be less expensive to simply fix it yourself. If you value piece of mind most, it’s probably a good idea to get a warranty.

 

     How did you do? If you answered two or more of these questions “yes”, it’s probably a good idea for you to purchase a warranty. Warranty companies are not out to scam people. They are out to make money. It’s similar to a health insurance company, or any insurance company for that matter. Insurance companies offset the cost of paying claims on sicker people by charging a higher premium and selling plans to healthier people. With vehicle extended service plans, they offset the cost of paying claims by charging higher premiums for vehicles more likely to break down and offering plans for those vehicles less likely to break down.

     Calculating your risk can help you determine if you need a warranty and how much you should pay for it. While there are people that pay for their warranty and never use it, there are also those who have been saved from financial catastrophe because they purchase a warranty at the time of sale. A bumper to bumper warranty may cost more but it will bring peace of mind that the money you just spent on a vehicle won’t go down the drain when a break down happens.

 

 

Content By: The Used Car Store

1803 Brighton Place

Pittsburgh, PA 15212

http://theusedcarstore.com/

(412)-315-7986

Top 10 Fuel Efficient Used SUVs

     Buyers in the 90’s drawn to roomier cabins, additional 3rd row seating and towing capacity exploded the Sport Utility Vehicle into the main stream to replace less attractive station wagon or family van. Buyers were looking for a more modern way to transport families and belongings. Auto makers welcomed the change in taste since they could reap much larger profits from an SUV as opposed to sedan. As SUV’s became more popular, auto makers focused manufacturing and engineering on the sport utility vehicles. As a result, SUV’s were made with the masses in mind and began to offer luxury features, higher safety standards and fuel efficiency. In the 90s fuel costs were much lower than they are today and over the years, automakers have been able to engineer SUVs that are more and more fuel efficient. Today’s SUVs can be produced with fuel efficiency similar to sedans. Consumers looking for a fuel efficient SUV have their pick of makes and models. Here is a list of the most fuel efficient used SUVs. All of the vehicles on our list were manufactured in 2011 or prior and fuel efficiency ratings are an average of the years highlighted.

 

#1 2001-2005 Toyota Rav4

EPA Fuel Economy Rating: 25MPG CITY/ 31MPG HIGHWAY

2005 Toyota Rav4

Toyota debuted the Rav4 with excellent fuel economy for its segment. Even first and second generation Rav4s had impressive fuel economy that is equivalent to models being produced today. An unexpected category of buyers loved the Rav4… women. It was the top registered make or model for female drivers according to 2003-2004 registration data.  It was a perfect combination of car-like comfort with room for the family and all their stuff. Toyota’s reliability propelled the model to mass popularity.

 

#2 2001-2007 Ford Escape

EPA Fuel Economy Rating: 25MPG CITY/ 28MPG HIGHWAY

2005 Ford Escape

Ford’s first generation Escape was released for the 2001 model year with another SUV owned by Ford, the Mazda Tribute. At the time, automakers mainly produced sport utility vehicles based on truck-like frames. Similar to other makers at the time, Ford and Mazda decided move away from truck based engineering for sport utilities in favor of smaller unibody car-like designs. By building their sport utility on a car like base, Ford was able to improve ride comfort and fuel efficiency. Buyers loved the design and Ford’s Escape became a staple in the blossoming sport utility market.

 

#3 2007-2011 Jeep Compass

EPA Fuel Economy Rating: 24MPG CITY/ 29MPG HIGHWAY

2011 Jeep Compass

The Compass was Jeep’s offering in the expanding crossover market. Jeep, normally known for its rugged luxury and off-road ability was looking to enter into the everyday driver market and targeted first-time SUV drivers that spent more time on the pavement. Its entry level crossover was built on the Chrysler MK’s platform and shared many attributes with the Dodge Caliber. The Compass was affordable, easy to drive and fuel efficient.

 

#4 2002-2007 Saturn Vue

EPA Fuel Economy Rating: 23MPG CITY/ 29MPG HIGHWAY

2006 Saturn Vue

Saturn first introduced its car-based compact SUV for the 2002 model year. The Vue was attractive to buyers for Saturn’s “no hassle” buying experience and low price. Throughout the first generation of production, Saturn continuously made improvements to the model. Buyers loved the dent-resistant body, cabin space, and the refined and powerful engine. With its redesign in 2008 the Vue actual lost fuel efficiency in favor of additional features and an engine change. The model was discontinued with the end of the maker in the US in 2009.

 

#5 2001-2007 Mazda Tribute

EPA Fuel Economy Rating: 23MPG CITY/ 28MPG HIGHWAY

2007 Mazda Tribute

Mazda’s Tribute story is the same as its sister vehicle the Escape. Similar to the Escape, the Tribute was built for a more general audience of buyers. The main difference between the Tribute and Escape is the Tribute’s firmer suspension meant for a sportier ride.


#6 2001-2007 Toyota Highlander

EPA Fuel Economy Rating: 22MPG CITY/ 27MPG HIGHWAY

2007 Toyota Highlander

Unlike its competitors like Jeep Grand Cherokee, Chevrolet Trailblazer and Toyota’s own 4Runner, the Highlander focused on on-road comfort. The Highlander’s design allowed for a sedan-like ride, roomy interior of a family van and ability of an SUV. Toyota soon offered the model in a highly popular 3rd row configuration that allowed seating capacity for seven. It performed well off-road and offered a smooth ride on pavement.

 

#7 2008-2011 Nissan Rogue

EPA Fuel Economy Rating: 22MPG CITY/ 27MPG HIGHWAY

2011 Nissan Rogue

Like many on this list, Nissan’s Rogue attempts to combine four-wheel capability and driving position of an SUV with the handling and fuel efficiency of a sedan. It succeeded. The Rogue added bold styling, higher class materials and comfortable interiors that attracted luxury-type buyers. For Nissan, form and function were equally important.

 

#8 2008-2009 Hyundai Tucson

EPA Fuel Economy Rating: 21MPG CITY/ 27MPG HIGHWAY

2009 Hyundai Tucson

The first generation Hyundai Tucson first offered in 2006 came out of the gate ready to compete in the highly competitive SUV market. It was offered in the base GLS, the mid-line SE and the top-tier Limited which gave buyers plenty of options to choose from. The base model was well-equipped with air-conditioning, cruise, airbags, alloy wheels, multi-function CD player, and keyless remote entry to name a few. It presented an excellent value looking for an SUV experience in an everyday comfortable driver.

 

#9 2004-2010 Kia Sportage 2

EPA Fuel Economy Rating: 21MPG CITY/ 26MPG HIGHWAY

2010 Kia Sportage

While purists criticized Kia for moving the Sportage away from its first generation’s off road ability and moved toward a more comfortable and palatable ride, buyers loved noticeable quality improvements from the first generation models. It received a full facelift and more modern exterior design. Consumer Reports name the model one of the most reliable vehicles in their 2009 reliability survey and ranked second in least expensive vehicles to insure in the same year.

 

#10 2001-2006 Honda CR-V

EPA Fuel Economy Rating: 20MPG CITY/ 26MPG HIGHWAY

2007 Honda CR-V

The third generation CR-V hit the market in 2006. It was more compact than previous versions. It’s powered by Honda’s K-Series 2.4L engine which versions of can also be found in Accord and Element. It’s size, ability, safety features and fuel efficiency launched the model into the ten best-selling vehicles of 2007. It has remained a staple of Honda’s lineup since its introduction.

 

     Sport Utility buyers want value the same characteristics that any other buyer values. Reliability, capability, value, ease and yes… fuel efficiency. Buyers don’t have to sacrifice fuel costs to get what they want. There are plenty of used SUVs on the market that were produced with main stream fuel efficiency in mind.

 

 

Content By: The Used Car Store

1803 Brighton Place

Pittsburgh, PA 15212

http://theusedcarstore.com/

(412)-315-7986

What Is Buy Here Pay Here?

What Is Buy Here Pay Here Title


     Buy Here Pay Here is a used car loan offered directly from the purchasing dealer, typically for those that have poor or no credit at a higher interest rate. The difference between Buy Here Pay Here and special financing for consumers with bad credit is the loan is backed by a dealer as opposed to a bank. Buy Here Pay Here allowed used car dealers to extend financing to those customers that would not have been able to meet regular or even special financing requirements. Buy Here Pay Here was started in the 1970s during the savings and loan crisis. Dealers had to come up with a solution for the fact that credit was more difficult to obtain and vehicle prices were increasing at a rate higher than income. They found a way to supersede the banks by becoming the bank. Auto dealers would finance the loan themselves.  

What Is Buy Here Pay Here Quote

     Buy Here Pay Here opened up vehicle purchasing to those that were unable to obtain credit through regular channels. Whether the consumer had bad credit, no credit or were unable to verify income the dealer could finance the loan. Prior to regulation some used car dealers not bound by finance laws would offer loans without disclosing finance costs and total price or charging exorbitant interest rates. Practices such as these in beginning of Buy Here Pay Here cemented a reputation for dealers that many have found difficult to overcome even to present day. Dealers that offer any type of financing today are bound by financing laws. State finance laws regulate licensing, maximum interest rates, grace periods, fee amounts and more.

     A Buy Here Pay Here customer can expect to have a larger down payment amount than better credit customers. The loan term is usually shorter. Payments are made directly to the selling dealer. In general, any credit situation is accepted including bankruptcy, repossession, divorce. Any financial situation is also accepted like the inability to verify income or residence.

     Well-meaning loved ones may advise consumers to avoid Buy Here Pay Here at all costs but in most cases those loved ones likely have credit and income that can secure them a regular loan. While it should be a last resort, Buy Here Pay Here does fill a need in vehicle sales and auto loans. Credit problems are in most cases temporary and cause by unavoidable financial catastrophes. Those financial problems only compound when a consumer loses the ability to travel to and from work. For some, Buy Here Pay Here is the only way to dig themselves out of trouble and get back on their feet. It can be a life saver to people otherwise unable to get a car loan.

     Any time a large purchase is being made a consumer should consider the program and dealer that works for them. Find the best financing possible by shopping around. If Buy Here Pay Here is the only option, ensure the terms are clear. Always read your contract thoroughly and research the company you are purchasing from.



Content By:The Used Car Store

1803 Brighton Place

Pittsburgh, PA 15212

http://theusedcarstore.com/

(412)-315-7986




Online Car Loan Applications - How To Stay Safe

Online Car Loan Applications

     Technology has changed us. In an online world there's fewer and fewer reasons to leave your house. Almost anything can be handled online. People have access to goods and services that would have been unthinkable 15 years ago. You can order a pizza online and watch them make it, you can order obscure items handmade from villages in Indonesia. You can even have a doctor visit online via video conference and be prescribed medication that will be mailed to you (overnight we might add).

    There are limitless benefits to a connected society. There are also pitfalls. Scammers and thieves have advanced their techniques to be on par with the latest technology. Identity theft is a serious concern. While legitimate businesses using perfectly safe technology are trying to reach their customers, identity thieves are trying to intercept. While there's no 100% guaranteed way to avoid accidentally giving over your information to a scammer there are a few steps you can take to minimize your risk.

·   DO apply with “Brick and Mortar” Dealers… The easiest way for thieves to get your information is to direct you to a site that looks like a real business. It’s called Phishing and it’s a way to trick you into giving out your information. A real business has a real physical address that can be verified on Google or other business listing sites. Verify that the website you are about to submit your information to is the correct website on the dealer’s business listing.

·  DO make sure the application is SSL secure… SSL stands for Secure Socket Layer and it protects information like social security numbers and identity information. Where a normal website page collects and sends information to the server in plain text, SSL security encrypts that data so even if there is a breach of the site, the data is unusable. How to you know you’re on an SSL secure site? Look at the address bar. SSL secure pages begin with “https” instead of “http.”

·   DON’T follow links from emails… Real dealers may send you emails. Especially if it’s a dealer you have purchased vehicles from before. You can follow a link from an email if you have ensured that the email belongs to the dealer you are intending to apply with but it’s always safer to simply Google the dealer and go to their page through search.

·   DO call the numbers listed on the site you want to apply… A simple phone call can clear up a lot. Does someone answer? Do you feel comfortable that the person you are talking to is really where they say they are?

     Car shopping today is much different than it was in the past and it’s smart to shop around for the best prices and rates. In today’s technological era you can do all of that from the comfort of your home. The majority of identity theft happens when consumers are redirected away from the page they are intending to visit. In the majority of cases, simply making sure you are shopping at a dealer with a physical location and are submitting your application through their actual site minimizes your risk. Real dealers want to protect your information as much as you do and they are required by law to do so.

      There’s no reason to miss out on shopping around online to find the best price for a used vehicle and the best rate for car loans. Online car loan applications are perfectly safe when you’re submitting them to actual dealers that are governed by state and federal law. Taking a few extra steps to protect yourself is simple and can prevent your information from getting into the wrong hands.

 

Content By:The Used Car Store

1803 Brighton Place

Pittsburgh, PA 15212

http://theusedcarstore.com/

(412)-315-7986

 

Considering “Value”: Buying a New or Used Car

Pros and Cons of Buying a New Or Used Car

      New or Used? It’s the age old question. Deciding on whether to buy a new car or a used car is the very first decision a consumer makes when embarking on the car buying journey. Which one works for you will depend on your personal preference and financial situation. Its deciding what’s a value to you. Do you value status and the newest features or do you value a good deal more? In our humble opinion (and not biased whatsoever) buying a used car like one of these great used cars is by far the best idea, but in this blog we’ll discuss the benefits and pitfalls of both. Can you get an objective opinion from a used car dealer’s blog on buying new or used cars? We’re not sure but we’re going to try and find out!

Advantages of Buying a New Car

Hello!? It’s NEW! There’s nothing like a new car. It’s hot off the presses. It even smells new. It’s got all the newest gizmos and gadgets. It’s a status symbol. It screams success and stability.

Again, it’s NEW! The reliability of a new car can be an advantage. It is a new car with all new components. It doesn’t have the benefit of being road tested but it is likely covered by a fantastic manufacturer’s warranty. A new car is also protected by legislation like Lemon Laws.

It’s yours… New cars pretty much come made to order. Want a bare bones model with just the necessities to save a couple bucks? You can get it. Want every option? Something in between? No problem.

It’s easier… It’s easier to buy a new car. To buy a used car, you have to scour through classifieds to find what you want at the right price. You have to spend time going dealership to dealership and have the vehicle checked out prior to purchase. With a new car, you’re paying pretty much the same as everyone else and getting the same thing. Sure there’s discounts and dealer programs but there’s a retail price to gauge from. One brand new Altima has the same value as another with the same options. Two used Altimas can be the difference of 100,000 miles and who knows what else.

Advantages of Buying a Used Car

Choices? The choice to buy new or used may not even be a choice at all. If you don’t have good credit, a new car may not even be an option for you. And without excellent credit, you can cross off the no down payment and low interest rate in the “Pros” column…

And every well intentioned Uncle’s favorite advice… Depreciation… Depreciation is the most significant factor to weigh when deciding new or used. What’s depreciation? Depreciation is defined as “a reduction in the value of an asset with the passage of time.” To a new car buyer, depreciation means the vehicle you paid all that extra money for will lose value quickly and in the case of new cars that value loss is immediate. Trusted Choice has created an excellent infographic that clearly explains how new cars lose value. You can check it out here. You lose 11% of your new car’s value just driving off the lot. That’s 11%. Like eleven percent! The $20,000 you just spent to purchase that vehicle has just turned into $17,800 just by signing the papers and leaving the dealership. After one year, your car has depreciated 25% and is worth $15,000. After five years, your vehicle will have decreased in value by a whopping 63%. Your $20,000 investment is worth $8,000. There is no other investment that has worse returns. Any financial expert will tell you a new vehicle is the worst investment you can make. When you buy a used car, someone else took that depreciation hit and left your money in your pocket.

New or Used Car Quote

It's Used… How can being used be an advantage? Used cars are road tested. All of their parts and functions have been used and found to be in working condition, or else it wouldn’t still be on the road. While new cars are protected by manufacturers warranties and legislation like “Lemon Laws,” purchasing used will all but guarantee that you aren’t purchasing a vehicle with significant manufacturing complications.

Automotive Textile Fortification and Decontamination… or Air Freshener… With used cars, there’s no ridiculous add-ons. With new cars, you've agreed on a price and when you go to seal the deal and finally look at the invoice you see things like “Enamel Corrosion and Oxidation Impediment” for $800.00. What’s that? Rustproofing. Wouldn’t a new car already have been protected from rust? Of course it was.

Insurance Costs… Used cars cost less and so they cost less to insure. They are also less likely to be stolen helping to lower the cost to insure.

Better Options… When you buy used, the money saved can be used to upgrade your model. While the options aren’t custom like in a new car, you can afford to get more of them.

      The choice of buying a new or used car is decided entirely upon what a “value” is to you. Is it all about the cost? Or are you willing to pay more for the presumed life status a new car implies? Whichever you choose, considering all of your options and taking a little more time to weigh the costs and benefits will leave you more satisfied with your decision in the end.




Content By:The Used Car Store

1803 Brighton Place

Pittsburgh, PA 15212

http://theusedcarstore.com/

(412)-315-7986

What Are Sub-Prime Car Loans?


In finance, subprime lending (also referred to as near-prime, non-prime, and second-chance lending) means making loans to people who may have difficulty maintaining the repayment schedule, sometimes reflecting setbacks, such as unemployment, divorce, medical emergencies, etc.” Wikipedia.

      The way a bank figures out your likelihood to payback a loan is based on the following: How have you paid other similar accounts? Do you make enough to afford your payment? Are you financially stable?

      In normal lending a bank or lender is able to calculate and minimize the risk of non-payment. A potential loan customer has a credit score indicative of paying other accounts. A customer has income that can be verified and assets. A customer earns enough to present a comfortable payment to income ratio. People that have these characters can have their choice of loan at competitive rates.

      For those that do not meet requirements in those categories, lenders have created a solution… Sub-prime. Sub-prime simply means “less than prime.” Traditionally sub-prime loans are for borrowers having FICO scores below 640. This score range differs incrementally from lender to lender but if your credit score is below 640 you are generally a sub-prime borrower.

Sub-Prime Car Loans Quote

Sub-prime loans are not in and of themselves bad. While financial experts warn about hidden fees, undisclosed costs, exorbitant interest rates and consumers that are quick to take the first offer they receive instead of shopping around, sub-prime loans do fill a need in lending. Most of the pitfalls experts warn about are less about sub-prime lending specifically and more about “predatory lending” since all of the major detractions could happen to anyone in any credit range with a deceptive lender.

      It’s always important to educate yourself when considering a loan, especially for larger amounts like in car loans and mortgages. While it’s not always easy to read the phone book of loan documents, you can ask your lender direct questions about fees and terms until you are satisfied. It’s also necessary to educate yourself about borrowing in general so you know what general practices are. If you don’t know what’s normal how could you possible spot an abnormality?

      Sub-prime lending serves a need. Many people wouldn’t be able to have the security of a vehicle or mortgage without it. It is a legitimate part of the industry that allows otherwise unqualified consumers to secure car loans and mortgages with a little more documentation of financial status and likely a higher interest rate.

      Many times consumers are not irresponsible in general. Everyone wants to pay their bills. People don’t want to go into bankruptcy or foreclosure or have their car repossessed. Most times, a perfectly well intended consumer secures a loan at a time when paying that loan is perfectly feasible. Then tragedy strikes. An expensive break down, job loss, illness or financial catastrophe knocks them off the peg. One unpaid bill becomes another and a downward spiral begins. If you can’t get credit after credit problems arise, how do you prove to lenders that you are now back on your feet and stable enough to repay a loan? It’s a Catch 22 and sub-prime lending is sometimes the only answer.

      Sub-prime loans usually entail more documentation or proof that you have the ability to pay. Instead of using your credit score as an indicator of likely repayment, lenders will use your “stability and ability.” Are you able to pay (based off of your income and loan amount), how long have you been able to pay and how long can a lender predict that you will be able to continue to pay? It will also cost more. A consumer with a good credit score can expect to have their choice of loan structure and rates below 6%. This is reflective of the lender's risk in taking the loan. Good credit customers are more likely to pay and therefore present less risk. Bad credit customers are less likely to pay and present more risk which is why they can expect interest rates in excess of 10%.

      Bad credit car loans are an area where a consumer can make a significant improvement in their credit in a short period of time. While car loans are generally a significant amount, they are still much less and much shorter than mortgages. It presents an opportunity for consumers to prove again that they can pay a specified amount each month for an extended period of time. Since lenders require proof of income and residence, it is likely verified that you have enough disposable income to repay the loan.

      While the sub-prime lending market can be wrought with problems for lenders and consumers, it gives an educated consumer coming off financial problems to improve their situation and get to work while doing it.


Content By:The Used Car Store

1803 Brighton Place

Pittsburgh, PA 15212

http://theusedcarstore.com/

(412)-315-7986


Top 10 Credit Myths Hurting Your Score

Top Ten Credit Myths Title

   Maintaining credit isn’t easy. Even complete financial stability does not guarantee that your status will be reflected in your score. An extremely wealthy person with no debt can have a horrible credit score. That’s because scoring models don’t consider your income when deciding your credit worthiness. If that wealthy person does not have different types of credit accounts that are paid on time and reported to the credit bureaus they could even have no score at all. Scoring models determine your credit worthiness on factors including number of accounts, payment of accounts and credit utilization. Bureaus do not publicly report the calculations that determine your score and while experts have over the years made educated guesses on the components behind their models, it is by no means definitive. An obscure system such as this leaves plenty of room for misinformation. Here the top ten myths that could be hurting your score right now.

MYTH #1: CHECKING MY CREDIT HURTS MY SCORE

      A common credit myth is that credit checks damage your score. Holy moly this one’s a whopper. This is one of the most detrimental credit myths. Its foothold on the psyche of credit consumer has prevented multitudes from educating themselves about their credit rating. How can you maintain or improve your credit rating if you’re too afraid to check it? It’s important to understand that there is more than one type of credit pull, because credit is accessed for two different reasons. A “soft pull” is used to simply access information from your report. Soft pulls are used to check your own credit, or when you apply for a job and complete a background check. It’s also the same type of pull that is performed so that credit card companies can pre-approve you for offers. Soft inquires can occur often and even without your express permission. A soft pull has no effect whatsoever on your credit score. That needs said again: A soft pull has no effect whatsoever on your credit score. “Hard pulls” are used when you’re actual taking financial action like applying for a credit card or loan. It’s when a lender is making an actual decision about opening a credit account. Still confused? An easier way to understand the difference between hard and soft pulls is that a soft pull is simply for informational purposes. A hard pull is a pull with intent to actually open a new credit account. But even hard inquires have a very small effect (a few points if any) on your score and are temporary. Additionally, new changes to the scoring system can detect when you're shopping around for a car loan for example. FICO now has a system in place where multiple hard pulls are scored as a single request if made within a 45-day period. They have adjusted the model to account for when consumers are loan shopping. As long as you're not opening multiple accounts in that 45-day window, it will be calculated as a single pull. From myfico.com "FICO scores distinguish between a search for a single loan and a search for many new credit lines, in part by the length of time over which inquiries occur."

Top Ten Credit Myths Quote
    

      Soft pulls have no effect on your score. As a matter of fact, go do that right now if you haven’t… Take your pick. AnnualCreditReport.com is the site managed by the credit bureau to allow you a FREE copy of your credit report once per year as required by federal law but recently a multitude of sites like Credit Karma, Credit Sesame and Credit.com offer free access to your report and score. It’s really, truly free and are loaded with credit tools and recommendations to repair your credit.

 MYTH #2: I HAVE ONE CREDIT SCORE

Credit Karma Factors     A common credit myth is that there is one score that all creditors use to determine your credit worthiness. There’s your FICO Score which ranges from 300-850, Experian ranges from 330-830, Equifax ranges 300-850, Transunion and the Vantage Score 3.0 which ranges from 300-850. When you get into credit helping sites, many of them have their own scoring system which is based off of the national scoring models but is not exactly the same. Some lenders have custom scoring models based on the type of credit they offer. Different credit holders report to different bureaus. Your score with Equifax can be significantly higher or lower depending on the credit companies you use and which companies report to where. Most lenders use an average of your three Fico scores with Experian, Equifax and Transunion so it’s important to make sure your credit information is correct with all three bureaus.

MYTH #3: AFTER SEVEN YEARS BAD ACCOUNTS AUTOMATICALLY DISAPPEAR

      It’s true that credit bureaus are governed by the Fair Credit Reporting Act’s (FCRA) rules that limit the time a negative report can remain on your bureau. The confusion comes when understanding the time limit by account type and more importantly when that clock starts ticking.

Regular credit accounts, civil judgements and tax liens can be reported for seven years. Chapter 11 Bankruptcy can report for ten years. One exemption to the seven-year rule is credit transactions involving 150,000 or more and “to items of information added to the file of a consumer on or after the date that is 455 days after September 30, 1996”.

      So the seven-year rule is an actual rule. Most of the confusion for consumers comes in this paragraph of the code “The 7-year period... with respect to any delinquent account that is placed for collection, charged to profit and loss, or subjected to any similar action, upon the expiration of the 180-day period beginning on the date of the commencement of the delinquency which immediately preceded the collection activity, charge to profit and loss, or similar action.”

Credit companies will report late payments immediately, but the seven-year clock does not start until the account was delinquent 180 days, so the account will remain on your credit report for seven years and six months since you stopped paying the account.

      The credit bureaus are bound by the rules in the FCRA so if you have an account on your report that isn’t complying with these regulations, you should contact the bureaus and have it corrected.

MYTH #4: INCREASING MY INCOME INCREASES MY SCORE

      Credit scoring models do not consider your income. Credit scores are based off of account reporting to the three credit agencies. While income is a consideration for ability to pay, it’s not an indication of your creditworthiness. Think about it. A person that makes $500,000.00 per year could have plenty of credit and manage it poorly. Just as someone who makes $30,000.00 per year could have plenty of accounts and manage them perfectly. Income is important to lending and many lenders will consider your income when you’re applying for things like a car loan or mortgage but they consider those things during the application process, not from your bureau.

MYTH #5: CARRYING A BALANCE HELPS MY SCORE

Credit Utilization Chart      In no way shape or form does it help your score to carry a balance and it could cost you big in finance charges that you would have avoided. The confusion likely started with the definition of “carry a balance”. If you think carrying a balance is leaving an unpaid amount on your card to “carry over” to the next billing cycle, then carrying a balance is not good. Actually it’s bad. If you think carrying a balance means using your credit card so that there is activity and paying it off before the cycle bills, then good! You understand that adding debt is never good for your credit. Your “credit utilization” is a hefty part of your score. It accounts for 30% of consideration. Credit utilization is simply the ration between the amount you owe and the amount available to you. For example, if you have 3 credit cards with a 10,000 limit each you have 30,000 in available credit. If you have a 2,000 balance between those three cards your utilization would be 6%. With 0% being a perfect utilization score, you can see that carrying balances as defined above would be detrimental to your credit rating. The confusion likely came from a good place where well intended people confused carrying a balance with using your credit. You want to use your credit. If possible you want to use all of your credit accounts for purchases at least once a month to keep the account active and allow the credit card companies to compete a bill cycle but paying that bill before cycle will allow your utilization ratio to remain low and avoid any interest charges you would accrue by “carrying a balance”.

MYTH #6: PAYING OFF AN INSTALLMENT LOAN EARLY HELPS MY CREDIT

      Installment loans like used car loans or personal loans are the best way to raise your score. They add another account to your bureau and add to the diversification of your account types. Unlike revolving credit accounts like credit cards, they do not effect utilization. They are so good for your score that paying them off early may actually have a negative effect. Paying it off early closes the account, and all that rich payment reporting each much will be cut short. An open account paid well a much better account type for your credit score. Keep them open and pay on time!

MYTH #7: CREDIT BUREAUS CONSIDER RACE, AGE AND SEX

      Most reasonable people know that race does not affect your score but sex and age? While the credit bureaus do retain information like age and sex, they are prohibited by law from considering those factors in any scoring model. The Equal Opportunity Act prevents it. Lending decisions are not allowed to be based in any way on your race, religion, national origin, marital status, age or sex.

MYTH #8: WELL PAID UTILITY ACCOUNTS HELP MY SCORE

      Well they would… If they report it. One would reasonably assume that if they pay a phone, gas, water and electric bill each month that would be reported on their bureau. Many people assume that the bills they are paying each month like utility bills are reported but they would in most cases be wrong. Most utility companies do not report consumer’s regular utility payments. There’s nothing legally stopping them. They could report like any other business that accepts payments. Most utility companies choose not to report and they have their reasons. The moment a utility company begins report payments, they are instantly bound by the FCRA. They must perform investigations when a dispute is initiated as required by the law. They must provide the maximum accuracy of what they’re reporting as required by the law. You could also argue that they don’t have a need to report. When you stop paying your gas bill it won’t be long before a little truck shows up to shut it off. Their services are more of a necessity, and simply the threat of losing the service is enough to get people to pay. Even though they mostly don’t report good accounts, there is a possibility that they will report a delinquent account or one that is closed with money owed.

Credit Myths Quote 2

MYTH #9: ALL CREDIT CARDS ARE THE SAME

      Not true! Some credit cards report to one bureau. Others report to all three. Some report detailed payment history and some not so much. If you’re trying to rebuild credit find a card that reports to all three bureaus and includes your payment history. A well paid credit card is great. A well paid credit card that reports to all three bureaus is tremendous for helping your overall average score. It’s easy to find out how each credit card reports. Search for reviews on the card you’re considering. Sites like Credit Karma will have reviews from others who have actually used the card. They report things like their credit score when approved, reporting of the company, limit amounts, customer service and interest rates. Always do your research before opening a new card.

MYTH #10: THE CREDIT BUREAUS ARE A PART OF THE FEDERAL GOVERNMENT

      While the Federal government regulates many actions and policies of the credit bureaus, they are private entities. And they are not non-profit companies. They are privately and publicly held for profit corporations. They look to maximize profits like any other private company. They make money by selling credit information to individuals and lenders and by charging companies to report credit accounts. Creditors have to pay to report your account, which is why a small debt you owe to a local business is much less likely to be reported. Some of the bureaus have minimum account reporting requirements which excludes smaller companies. This is all the more reason it’s important for you to monitor your score. You may pay plenty of people on time and in full but if that company does not report unless you are delinquent, there’s no benefit to your score.

 

 

 

Content By:The Used Car Store

1803 Brighton Place

Pittsburgh, PA 15212

http://theusedcarstore.com/

(412)-315-7986

 

How To Repair Your Credit With An Auto Loan

How To Repair Your Credit With An Auto Loan Title

     With all of the free (like actually free) credit management sites like Credit Karma, Credit.com, Credit Sesame From Credit Karmaand more, there’s really no excuse to not know where you stand. While your credit situation may be a result of unforeseen and unavoidable financial issues, knowing your situation has become easy. With these sites you can track your score with all three bureaus, manage your credit accounts, fix missing or incorrect information on your report and more importantly learn about credit and how your score is calculated. These sites check your score on a weekly or monthly basis and while inquiries do not have the affect you might think they have, the way these sites pull your credit does not affect your number of recent inquiries at all. What is the fastest way to repair credit? A well paid installment loan like a mortgage or Car Loan.

 

     An installment loan is simply a loan of any sum that is payable over a set time with a set number of payments. From Credit.com “Mortgages and installment loans tend to be the valuable to your score as they tend to reflect stability.” Installment loans tend to be verified by actual documents such as proof of residence and proof of income as opposed to a credit card which simply uses your credit score. The credit bureaus tend to value these loans higher than other types of credit for just that reason. A “Trade Line” are account records that are provided to the Bureaus. Different types of trade lines indicate that you are more experienced with handling credit and therefore a healthy account mix has a higher impact on your score.

Repair Your Score With An Auto Loan Quote

     Another significant impact of auto loan on your credit score is the fact that car loans tend to be of a higher amount that regular credit cards. For most consumers, an auto loan is one of the larger purchases they make in life. The impact of a large account such as an auto loan improves your credit in another important category, credit balance. The more companies are willing to lend you, the more credit worthy you seem. Having a well-paid car loan not only improves your score tremendously, it will also help you get a better rate and higher approval chances on your next auto loan. Auto lenders look at your credit rating but they also consider how well other auto loans have been paid.


     Once you have the car loan, it is imperative to make your monthly installment payments on time. Even one missed or late payment can set your credit back seriously. If you’re trying to secure a car loan and you have bad credit, you may have to accept a higher interest rate than a good credit customer. The good news is that if you make your payments on time for a few months, you can go to a bank and they will likely be willing to refinance your loan at a more traditional rate.


     Credit scores are not easy, but not impossible to improve quickly. The overall theme the credit bureaus are looking for is stability and stability may take some time to prove. If you can keep your revolving credit payments up to date and pay an installment loan well, you can be on the road to huge jump in score.





Content By: The Used Car Store

1803 Brighton Place

Pittsburgh, PA 15212

http://theusedcarstore.com/

(412)-315-7986





Buy Here Pay Here

Our Buy Here Pay Here program is for those especially difficult cases. It’s for people with bad or no credit who are unable to provide proof of income or verification. Most consumers with bad credit or no credit believe that their only option is Buy Here Pay Here but that’s not true! Almost EVERYONE, regardless of credit is eligible for our Special Financing program. We will do our absolute best to get you the best loan that fits your situation, but in order to qualify for our special financing you must be able to prove your income. That doesn’t mean you have to get a W2. Other acceptable forms of proof can be your bank statement showing deposits. If you are unable to prove your income by one of these methods, that’s still OK! The Buy Here Pay Here program is for you! Buy Here Pay Here has a higher down payment and a generally short term loan but it can get someone driving that would be unable to in any other circumstance.

How Do I Qualify?




Are you a human? You’re Qualified.

How Do I Apply?



Even though we do not pull your credit for Buy Here Pay Here, the fastest way to get your loan is to fill out a credit application on our website. That way we will have the bulk of your information and will be able to give you a concrete down payment amount.

What Do I Need To Bring?



·         DOWN PAYMENT – Down payments for our Buy Here Pay Here program vary based on the cost of the vehicle you want to purchase. Each car is different. Generally, you will need 50% down. Some vehicles are less.

·         IDENTIFICATION – You will need identification to process your registration and contract.

·         INSURANCE – By law, you need active insurance to purchase a vehicle in Pennsylvania. If you already have insurance, you can simply call your agent or company to have it applied to your new vehicle. If not, no worries! We can help you get insurance at the store.

 

Buy Here Pay Here is perfect for those that cannot prove income and are working on rebuilding their credit. Apply online and we’ll get you driving TODAY!

 

Content By:

The Used Car Store

1803 Brighton Place

Pittsburgh, PA 15212

http://theusedcarstore.com/

(412)-315-7986



No Credit / Bad Credit Special Financing

At The Used Car Store, we partner with multiple sub-prime lenders that will finance even the most difficult credit situations. No matter how bad your credit is, if you can prove income we can get you an approval. Many customers believe that Buy Here Pay Here is their only route when you’ve had credit problems in the past. It’s not true! We have lenders that work with every situation including Bad Credit, No Credit, Bankruptcy, Divorce, or even Repossession. They don’t care about your past. They care about your ability to pay now. They determine your ability to pay now by your income. If you bring us a paystub we can get you a car loan. To see if you qualify for special financing fill out our Car Loan Credit Application online. We can get you an approval in minutes!!

If you have an income that is verifiable via paystubs or bank deposits, you’re approved. 


Our super-fast Online Application is the fastest way to get approved. Our credit application is one of the shortest around. There are only a few required fields. Enter as much or as little information as you want. Get an answer in minutes! Or you can apply in-store or over the phone.


  • Identification – You will need state issued identification
  • Proof of Residence – Gas bill, phone bill, light bill. A bill that gets mailed to your residence.
  • Proof of Income – Regular wages are verified by pay stub. Self-employment is verified by checking deposits. We will need the actual bank statement that gets mailed to your house or delivered to you online. For Fixed Income, like pensions, SSI/SSD or unemployment we will need an award letter or monthly statement.
  • Insurance - By law, you need active insurance to purchase a vehicle in Pennsylvania. If you already have insurance, you can simply call your agent or company to have it applied to your new vehicle. If not, no worries! We can help you get insurance at the store.



The Used Car Store and our Partners understand that good people can end up with bad credit. Sometimes all it takes it one major financial disaster to ruin a good person’s credit. We’re here to help!



Content By:

The Used Car Store

1803 Brighton Place

Pittsburgh, PA 15212

http://theusedcarstore.com/

(412)-315-7986



Welcome To The Used Car Store

The Used Car Store is The dealership for used cars in Pittsburgh. With our extensive vehicle checklist we vigorously inspect each vehicle so that our customers are provided with complete transparency during purchase. Our goal is to provide quality, affordable transportation to all. We know you need to get around. Let us help you! We keep our costs to a minimum so we can offer you the BEST PRICE on your used vehicle. We have quality cheap cars that will fit any budget.

Don’t have cash? NO PROBLEM!We partner with multiple car loan lenders and will get you the best rate and a comfortable installment loan plan. If you’re looking for a good Used Car with Bad Credit in Pittsburgh, NO PROBLEM! We also partner with multiple Sub-Prime Lenders that are industry leaders in getting auto financing for those who can’t get financed anywhere else. AND If you have bad credit and no employment documentation, we finance you ourselves!! Through our Buy Here Pay Here Program with No Credit Check, WE are the bank. We know that good people have bad credit. We’re here to help.

If you’re interested in our low rate car loans, Bad Credit Financing or Buy Here Pay Here, fill out our credit application online! You’re already approved! We just need your information to get you the best program to fit your credit and budget. It’s super-fast with a minimum number of required fields. You will get an approval in minutes!

Downpayment problems? That’s OK! We take Trade-Ins! We also Buy Any Car for CASH! To get an instant FREE appraisal of your Trade-In, fill out our “Cash For Cars” form.

The Used Car Store is new, but the Owners have been in sales for many years. A husband and wife that, with the help of our wonderful family were given the opportunity to make our own way. Our business is all we’ve ever wanted. We want every customer to understand how important customer satisfaction is to us. We want you to buy a car from us and KEEP buying cars from us.

Let us show you.