Used car dealerships face unique payment challenges compared to new car franchises. Buy-here-pay-here models require robust installment loan management. Customers often have credit challenges affecting payment methods. Smaller margins mean processing fees significantly impact profitability. Inventory turnover demands quick payment processing. Payment solutions designed for used car operations address these specific needs.
Used Car Dealership Payment Needs
Used car operations differ fundamentally from franchise dealers. Many customers can’t qualify for traditional financing, creating buy-here-pay-here opportunities. These in-house financing arrangements require collecting down payments, processing bi-weekly or monthly installment payments, managing late payments and collections, and handling early payoffs or trade-ins of financed vehicles.
Smaller average transaction sizes mean processing fees consume larger percentages of revenue. A 3% processing fee on a $15,000 used vehicle is $450-a significant portion of already-thin margins.
1. Revitpay
Revitpay understands used car dealership operations and buy-here-pay-here business models, providing payment processing that handles in-house financing, down payment collection, installment billing, and the unique challenges smaller independent dealers face.
Buy-here-pay-here loan management is the platform’s strength for used dealers. When customers purchase vehicles with dealer financing, the system sets up automatic installment billing on whatever schedule the dealer offers-weekly, bi-weekly, or monthly payments.
Down payment processing handles the variety of payment methods used car customers present. Cash down payments are documented and tracked. Card payments process immediately. Personal checks can be accepted with verification. Multiple payment sources can be combined.
Installment payment automation reduces collection efforts. Payments deduct automatically on scheduled dates from customer bank accounts or cards. Failed payment alerts notify dealers immediately. Successful payments update loan balances automatically.
Late payment management provides tools dealers need. Automated reminders go to customers before payment due dates. Late payment notices send when payments are missed. Grace periods can be configured to dealership policies.
Early payoff handling is automated. When customers want to pay off loans early or trade in financed vehicles, the system calculates exact payoff amounts including remaining principal and any applicable fees.
Mobile payment acceptance matters for used dealers. Sales staff can process down payments on the lot during sales. Owners can accept installment payments when customers come to the office.
Fee structures are designed for used car economics. Competitive rates on card processing, low-cost ACH options for installment payments, and transparent pricing help dealers manage costs.
2. DealerTrack Payment Solutions
DealerTrack serves both franchise and independent dealers with payment processing integrated into their dealer management platform.
3. AutoManager Payment Processing
AutoManager provides dealer management software popular with independent used dealers with integrated payment solution handling vehicle sales and buy-here-pay-here loan payments.
4. Dealer Center Payment Solutions
Dealer Center offers payment processing specifically for independent dealers with features addressing buy-here-pay-here operations.
5. Square for Auto Dealers
Square provides accessible payment processing many small used dealers use with competitive fees, easy setup, and installment payment capabilities.
Choosing Payment Solutions
Used car dealerships should evaluate processors on processing fees, buy-here-pay-here loan management capabilities, down payment handling, installment billing automation, mobile payment acceptance, and integration with existing systems.
Bottom line: Used car dealerships need payment processing designed for their specific operations. The right processor reduces costs, automates collections, improves cash flow, and enables profitable in-house financing programs.
