Tote The Note Dealerships | Valley Auto Loans

The cost of dealer loans

Many bad credit borrowers are using something called tote the note dealers for the auto financing needs. When a consumer has bad credit, he or she is likely to have issues getting financed for a vehicle or don’t believe they can even qualify for a loan. However, tote the note dealers are growing every month, and they are specifically designed for consumers who have bad credit.

The Dealer Becomes The Lender

The in-house lenders that offer this form of tote the note financing are able to avoid the use of third-party companies, so they’re able to provide tote-the-note financing from their own dealership. Many people don’t have a good understanding of interest rates and how it effects a car loan. Tote the note car dealers may take advantage of this ignorance when offering you a loan for a car. To make it easy to understand, tote-the-note is a form of in-house financing, so instead of providing consumers with financing through a bank or similar option, the dealership directly finances the transaction. and you make the payments for the amount of the sale directly to the dealership.

When dealing with a tote-the-note dealership, consumers who have poor credit are much more likely to be able to get financed for a vehicle. It’s common for these dealerships to have a sign that says buy here pay here because they directly finance the consumer.

How Tote-the-note is Different from Traditional Dealerships

There are some major differences between traditional and tote-the-note deal car dealerships. A traditional dealership caters to consumers who have fair or good credit. On the down side, tote-the-note dealerships completely skip third-party financing options, but they also do not report to the major credit bureaus, accept virtually any type of credit situation and provide consumers with a unique shopping experience.

One of the biggest differences between these two types of dealerships is the overall shopping experience. Put simply, the experiences are reversed. When a consumer steps foot onto a traditional dealership, he or she will be approached by a salesman, and the salesman will work with the consumer to find a vehicle that the consumer really loves. In most cases, the budget, interest rate, lease terms and fine details are not handled until after the consumer has chosen a vehicle that he or she wants to purchase. At a tote-the-note dealership, the process is completely reversed.

After entering this type of dealership, the consumer will immediately be taken to the finance manager, and the consumer will need to discuss with the finance manager the amount of money that he or she can afford every week, which is used to determine what car the consumer can really afford. After discussing all of the details, the consumer will be taken to view vehicles that he or she can afford.

Guaranteed Approval

Many consumers choose to do business with a tote-the-note dealership because they’re almost guaranteed to be approved even though they will pay a much higher rate. A consumer’s current credit situation doesn’t matter. They could have poor credit, bad credit or good credit, and it’s almost guaranteed that they will be able to get financed for a vehicle.

Tote-the-note dealerships almost always skip the whole process of a credit check with guaranteed financing. What these dealerships really care about is proof of residency and income. Since these dealerships provide in-house financing, they’re taking a significant risk with their customers and want to know that their customers are residents and can afford to pay for the vehicle.

Interest Rates

Another big difference between the two types of dealerships is the average interest rate. A tote-the-note dealership is almost always going to send customers home with a higher interest rate. They can trap customers into high rates. The average interest rate is higher at these dealerships because they’re taking on significantly more risk than traditional dealerships, so they must be fairly compensated for the additional risk. Tote-the-note dealerships don’t report to the credit bureaus, and they seldom check the credit of their customers.


Another major difference between traditional and tote-the-note dealerships is the inventory. A tote-the-note dealership is likely to have a much smaller inventory than a traditional dealership. Also, the vehicles on this type of dealership are likely to be older and have higher mileage than the vehicles on a traditional dealership lot. The reason why tote-the-note dealerships have older, high-mileage vehicles is because they can get more money for vehicles that would otherwise be passed up by a prospective buyer looking for quality. They can ask more for something that is worth quite a bit less and then they can sell cars that would not sell as fast.

The person who owns the dealership has all of his or her money tied up in these vehicles and must wait on monthly payments. A traditional dealership doesn’t have such dependence on customers making timely monthly payments, and it isn’t taking on as much risk, so it can afford to have many new, low-mileage vehicles.

Why Consumers Choose Tote-the-note Dealerships

Unfortunately, many consumers have been turned down by traditional dealerships, and this is an experience that can be very irritating, and it can leave them feeling sad and ashamed. When going to a tote-the-note dealership, consumers are almost always approved, so they don’t have to worry about getting turned down and embarrassed.

Cheap pre-owned vehicles, weekly payment options and guaranteed approval are some of the reasons to work with these dealers. Consumers who have very low credit scores can expect to be approved, and it’s even possible for consumers to get approved after having a recent chapter 13 or 7 bankruptcy. Consumers don’t need to have established credit, and they don’t need to have someone co-sign on a loan. In most cases, tote-the-note dealerships require nothing more than proof of identity, proof of residency, proof of a monthly income and proof of employment. This basic information should be enough to get financed for a vehicle. Although there will likely be many high-mileage vehicles, it’s not uncommon for these dealerships to have newer, trustworthy vehicles.

The Disadvantages of Tote-the-note Dealers

Like everything in life, there are some disadvantages to doing business with these dealerships. One disadvantage, is the inability to use a tote-the-note dealership for credit rebuilding. Since these dealerships don’t report to the credit bureaus, they cannot be used to rebuild credit.

GPS Monitoring

Tote-the-note dealerships take on a lot of risk, and to compensate for the additional risk, it’s not uncommon for these dealerships to place a GPS unit inside of their vehicles. The tracking unit makes it possible for the dealership to repossess their vehicle if a consumer stops paying for the vehicle.

Automatic Shutoff

Like the GPS unit, this is another protective measure, and if a consumer stops paying for a vehicle, the dealership can use this device to prevent the vehicle from being driven. However, it’s important to understand that not all dealerships use these security devices because it can get very expensive to install such devices on every vehicle. One of the biggest downsides to using a tote-the-note dealership is that loans from these dealerships will almost always be high-interest loans. However, the increased interest rate is meant to compensate the dealer for working with consumers who’ve been turned down because of a poor credit score.

What to Do Next

Maybe you’ve experienced some difficult financial situations, and as a result, you have a poor credit score. Maybe you have no credit history at all or have filed for bankruptcy. Regardless of your situation, you can get financed for a vehicle. can help you get into a vehicle.

The first step of the process is filling out the credit application, which can be found here on our website. By submitting the credit application, you can obtain a pre-approved amount. When you visit the local dealership, you can discuss all of the details, and there is a good chance that you will be able to drive away with a vehicle on the day you visited the local dealership. If you’ve been turned down by traditional dealerships, you know that it’s one of the worst feelings in the world. It makes much more sense to work with a dealership that cares and won’t judge you based on your credit history. By filling out and submitting the credit application on our website, you’re on your way to getting approved for a reliable vehicle.



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