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Credit Acceptance Corp. Auto Loan Review

Many Americans drive everywhere. You can use a car to go to work, buy groceries or head anywhere that life demands. Without a car, many are stranded.

For borrowers with a poor credit score, it can be difficult to secure financing for a reliable vehicle. Finding the right lender to provide financing may be essential. If you need a car to get around but have poor credit, you may want to consider working with Credit Acceptance Corp.

In this review, we will take a closer look at loan options available through Credit Acceptance Corp.

About Credit Acceptance Corp.

Credit Acceptance Corp. was founded in 1972. The company’s goal is to help borrowers with any type of credit history secure financing. Credit Acceptance Corp. works with local dealerships to finance borrowers.

Credit Acceptance Corp. is what’s known as an indirect lender. So while you cannot apply for a loan directly through the company, you may be offered one of its loans through a dealership. The company’s lending model is different than that of most traditional lenders. The dealership where the loan is offered will get a portion of the payments on the loan.

Credit Acceptance Corp.: At a glance

Before you accept a final loan offer, it is important to shop around to compare rates of multiple lenders. Each lender has a different set of requirements for its borrowers, and can offer various terms.

Although it can be time-consuming to seek out and compare loan rates and terms, it’ll save you money when you pick the best auto loan for your situation. We want to make this clear, because nowhere on Credit Acceptance Corp.’s website does it discuss APRs or interest rates.

At the end of 2017, Credit Acceptance Corp. had about 11,500 participating dealers across the nation to offer indirect auto financing with the bulk of dealerships in five states: Michigan, Ohio, Texas, New York and Maryland. Dealers that work with Credit Acceptance Corp. will have a varied selection that may include new or used cars, which will make it easier to find a vehicle that suits your needs and your budget.

Although Credit Acceptance Corp. gives dealers the opportunity to work with any buyer, the individual dealers will set the terms of the loan, including the down payment, payment due dates and monthly payment amounts. Credit Acceptance Corp. offers a maximum loan term of up to 72 months, or six years.

A defining feature of Credit Acceptance Corp. is that it will work with anyone regardless of their credit. If you have poor credit or no credit, the company claims that it could still get you a loan. And Credit Acceptance Corp. reports its payments to the three major credit bureaus, so you could boost your credit score, too.

It’s important to know that the vast majority of customer reviews are negative. According to Consumer Affairs, Credit Acceptance Corp. has received 82 one-star reviews out of 90 for overall satisfaction. The comments range from bad to worse, with warnings to take caution. But the company will work with borrowers of any credit, so it may be the only available option for some people.

How to apply for financing

To get started, you will provide contact information to Credit Acceptance Corp. and get connected with up to three local dealers. You can also do your own research to find local dealers that work with Credit Acceptance Corp. Next, you will visit the dealers to find a car that suits your needs.

Once you find the right car, you can begin to work with the dealer about the loan approval process. Credit Acceptance Corp. recommends that you call ahead to make the process run smoothly. When you go to the dealer, make sure to bring your down payment and proof of income. Everyone is eligible for approval, but the terms will vary widely based on a combination of the borrower’s qualifications and the dealer’s requirements.

Depending on the dealer, the loan may be finalized immediately or in a few days. Once you and your local dealer have finalized the paperwork, you can drive off in your vehicle. Loan payments can be made without any fees through Credit Acceptance Corp.’s online portal, by phone, in person or by mail.

The fine print

The majority of contract terms are set by the individual dealerships, so you will need to carefully read the terms before agreeing to the loan. One limit set by Credit Acceptance Corp. is that the loan can’t exceed 72 months.

Credit Acceptance Corp. has very loose rules on personal information. The company’s privacy policy indicates that it will share your personal information for everyday business purposes and marketing, as well as to affiliates and nonaffiliates in certain circumstances. The personal information could include your Social Security Number, income, employment history, account balances and payment history. There is limited recourse to stop this sharing based on the terms of its privacy policy.

When you finance your vehicle, the terms will be set based on your current financial situation. If that changes, you may consider refinancing your auto loan. Credit Acceptance Corp. does not offer refinancing opportunities, but if you have a good payment history, you could refinance with another lender.

Be sure that you can afford the car payments before you sign the loan contract. You can use our affordability calculator to understand what kind of car payment you can make. The fact that Credit Acceptance Corp. will work with anyone on nearly any vehicle is a double-edged sword. Do not trap yourself into a financing deal that you cannot afford.

Pros and cons of financing through Credit Acceptance Corp.

Every lender has good and bad points. You will need to decide for yourself which features matter to you most. Take the time to compare offers from multiple lenders before you choose your next auto loan lender.

Highlights of Credit Acceptance Corp. auto loan financing

  • Will work with borrowers with any kind of credit history — even poor or no credit
  • Will work with borrowers with many kinds of untraditional income such as fixed, self-employment, temporary or unemployment
  • Works with local dealers across the nation to offer convenience to its borrowers
  • Easy-to-use online payment system with no fees associated

Lowlights of Credit Acceptance Corp. auto loan financing

  • Extremely low customer satisfaction ratings
  • Loose privacy policy
  • Provides no information on its website about APRs or interest rates for potential borrowers to better understand their options

The bottom line: Who is Credit Acceptance Corp. best for?

If you have a poor credit history or no credit history, Credit Acceptance Corp. could help you get into a vehicle. The company will work with any kind of credit history. Anyone with an untraditional income situation may be eligible for a loan with Credit Acceptance Corp., unlike with most other lenders. Additionally, the company will work with people who have a history of multiple repossessions, multiple auto loans or Chapter 7 or 13 bankruptcy issues. If you have struggled to get an auto loan based on one of these factors, this may be a good option for you. It might be one of the few avenues that you have available to get yourself into a vehicle.

If you have a good credit history and an income that is relatively high and stable, you should consider other lenders. You have good approval odds with other financial institutions, so the benefits that Credit Acceptance Corp. offers its customers does not apply to you.

As a reminder, make sure to compare multiple loan terms from various lenders before making a decision about your auto loan.

 

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