What Authority Auto Is and How It Operates
Authority Auto is a used-car dealership chain that operates in multiple states, primarily in the Southeast and Midwest. The company buys vehicles at auction, refurbishes them, and sells them to consumers, often marketing to buyers with limited credit history or past credit problems. Unlike a traditional franchise dealership tied to one manufacturer, Authority Auto sources inventory from various sources and handles its own financing through in-house lenders or third-party finance companies.
The dealership model is straightforward: you visit a lot, select a vehicle, negotiate a price, and arrange financing either through Authority Auto's own lending arm or through an outside lender. Authority Auto makes money on the sale price and on financing fees if you use their lender. This structure means the dealership has financial incentive to approve loans that a traditional bank might decline, which is why they market heavily to people rebuilding credit.
It is important to understand that Authority Auto operates as a for-profit business, not a nonprofit or government program. The vehicles sold are used, typically ranging from five to fifteen years old, and come with whatever mechanical condition the dealership's inspection process identifies. The financing terms, interest rates, and warranty coverage are negotiable within limits, just as they would be at any other dealership.
Key Takeaways
- Authority Auto is a used-car dealership that finances purchases in-house, making it accessible to buyers with poor or limited credit history.
- Interest rates and loan terms vary based on your credit profile, down payment, and the vehicle price, and are not set by the dealership alone.
- You should always get a pre-purchase inspection from an independent mechanic before buying, because the dealership's inspection protects them, not you.
- The dealership's warranty coverage is limited and often does not cover major repairs, so read the warranty document carefully before signing.
- You can bring your own financing from a bank or credit union instead of using Authority Auto's lender, which may save you money on interest.
How Authority Auto Financing Works
Authority Auto offers in-house financing, meaning the dealership itself lends you the money to buy the car, or they connect you with a third-party lender. In-house financing is faster than waiting for a bank to approve you—you can often drive off the lot the same day—but the interest rate is typically higher than what you would receive from a traditional bank or credit union.
The interest rate you are offered depends on your credit score, the size of your down payment, the age and price of the vehicle, and the loan term you choose. A larger down payment lowers the lender's risk and usually results in a lower rate. A longer loan term (say, 72 months instead of 48) spreads payments over more time, making each payment smaller but costing you more in total interest. Authority Auto's lenders will quote you a rate based on these factors, and you can negotiate within reason.
Before you sign a financing contract, read the terms carefully. Look for the annual percentage rate (APR), the total amount you will pay over the life of the loan, the monthly payment, and any fees (documentation fees, dealer fees, gap insurance). Some of these fees are negotiable. If the total cost seems high, you have the option to walk away or to bring your own financing from a bank or credit union, which may offer a lower rate.
Inspecting the Vehicle Before You Buy
Authority Auto performs an inspection on every vehicle before it goes on the lot, but that inspection is designed to catch safety issues and major mechanical failures—not to may provide the car is in perfect condition. The dealership's inspection protects the dealership from liability, not you from repair costs down the road.
Before you commit to buying, hire an independent mechanic to inspect the vehicle. This costs between $100 and $200 but can save you thousands if the mechanic finds hidden problems like transmission wear, engine damage, or frame damage from an accident. Many independent shops will do a pre-purchase inspection while you wait, and you can often have the inspection done at a shop near the dealership's lot. Do not skip this step, especially with used cars from a dealership you do not know well.
Ask the dealership for the vehicle history report (usually a Carfax or AutoCheck report). This report shows whether the car has been in accidents, had title issues, or been flooded. A clean history report does not may provide the car is sound, but a report with red flags is a reason to walk away or to negotiate the price down significantly.
Understanding the Warranty and What It Covers
Authority Auto typically offers a limited powertrain warranty on used vehicles, usually covering the engine, transmission, and drivetrain for a set period (often 30 to 90 days or 1,000 to 3,000 miles, depending on the vehicle and the dealership's policy). This warranty does not cover wear-and-tear items like brake pads, batteries, or tires, and it often does not cover repairs if you have not maintained the vehicle according to the manufacturer's schedule.
Read the warranty document before you sign the purchase agreement. Understand exactly what is covered, what is not, where you can take the car for warranty repairs, and whether you have to pay anything out of pocket. Some dealerships offer extended warranties for an additional cost, which may cover more components for a longer period. Extended warranties can be worth considering if you plan to keep the car for several years, but compare the cost against the likelihood you will actually need repairs.
Keep all maintenance records after you buy the car. If something breaks and you file a warranty claim, the dealership may ask to see proof that you have maintained the vehicle. Missing oil changes or ignored warning lights can void your warranty coverage.
Comparing Authority Auto to Other Financing Options
Authority Auto is one option for buying a used car with limited credit, but it is not the only one. A traditional bank or credit union may offer you a lower interest rate if you have a checking account with them or if you have a co-signer. Some credit unions specialize in lending to people rebuilding credit and may have rates competitive with or better than Authority Auto's.
You can also buy a used car from a private seller and arrange your own financing through a bank or credit union. Private-party sales often have lower prices than dealership sales, but you lose the (limited) warranty protection and you take on more risk if the car has hidden problems. A private seller is not required to disclose mechanical issues the way a dealership is in most states.
Another option is a buy-here-pay-here dealership, which finances cars directly and allows you to make weekly or bi-weekly payments at the dealership itself. These dealerships often work with people with very poor credit, but interest rates are typically much higher than Authority Auto's, and the cars are often older and less reliable. Use buy-here-pay-here only if you cannot get financing anywhere else.
What Happens If You Fall Behind on Payments
If you miss a payment on an Authority Auto loan, the lender will contact you to collect. Missing one payment will damage your credit score and may result in late fees. Missing multiple payments gives the lender the right to repossess the vehicle, meaning they can take the car back without your permission and sell it to recover what you owe.
If your car is repossessed, you will lose the vehicle and the money you have already paid toward it. You may also owe the difference between what the lender sells the car for and what you still owe on the loan (called a deficiency). This deficiency can be sent to a collection agency and will appear on your credit report for years.
If you are struggling to make payments, contact the lender as soon as possible. Some lenders will work with you to modify the loan, skip a payment, or extend the term. The longer you wait, the fewer options you have. Do not ignore payment notices or calls from the lender.
Red Flags and What to Avoid
Be cautious if a dealership pressures you to sign documents quickly or discourages you from having an independent mechanic inspect the car. Legitimate dealerships expect you to take time to make a major purchase decision and to verify the vehicle's condition.
Watch out for add-ons you did not ask for, such as paint protection, fabric protection, or GPS tracking devices. These are often added to the contract without your explicit consent and can add hundreds of dollars to your loan. Read every line of the contract before you sign and ask the salesperson to explain anything you do not understand.
Be skeptical of interest rates that seem unusually low for your credit profile. If you have poor credit and are offered a rate that seems too good to be true, it may come with hidden fees or conditions buried in the fine print. Compare the total cost of the loan (principal plus all interest and fees) across multiple offers before you decide.
Frequently Asked Questions
Can I bring my own financing to Authority Auto instead of using theirs?
Yes. You can get pre-approved for a loan from a bank or credit union and bring that financing to the dealership. The dealership will accept it as long as the loan covers the purchase price. This often results in a lower interest rate than the dealership's in-house financing, especially if you have a relationship with your bank or credit union.
What credit score do I need to get financing from Authority Auto?
Authority Auto does not publish a minimum credit score requirement. The dealership works with people across a wide range of credit profiles, including those with no credit history, recent bankruptcy, or poor payment history. Your actual rate and terms will depend on your specific credit situation, down payment, and the vehicle price.
What should I do if the car breaks down right after I buy it?
Contact the dealership when ready and explain the problem. If the issue falls within the warranty period and coverage, the dealership should repair it at no cost to you. If the problem is not covered by warranty, you will need to pay for repairs yourself. This is why an independent pre-purchase inspection is so important—it catches problems before you own the car.
Can I return the car if I change my mind?
Most used-car dealerships, including Authority Auto, do not offer a return or cooling-off period once you have signed the purchase agreement and driven the car off the lot. Some states have a short window (usually 24 to 72 hours) to cancel, but this varies by location. Ask about the dealership's return policy before you sign.
What happens to my loan if I sell the car before it is paid off?
You will need to pay off the remaining loan balance before you can transfer the title to the new owner. If you sell the car for less than you owe, you will have to pay the difference out of pocket. If you sell it for more, you keep the extra money. Contact your lender to find out the exact payoff amount before you list the car for sale.