Should You Buy a Used Car with a Credit Card in Texas? 

Here's What You Need to Know

Did you know the average credit score in Texas is 680? Purchasing a used car with a credit card might be an open and shut case for some, especially if you own a card with a hefty credit limit. 💳

But… before you swipe for that rugged 2005 Ford Ranger with only 120,000 miles, consider the pros and cons of credit cards.

By the way, if you haven’t heard of Public Auto Auctions, located right here in Kyle outside Austin, then come check out some of the best deals of used cars in the Lone Star State.

Pros and Cons of Credit Cards

Credit Card Pros: 🙂

• Convenience: Buying a car with a credit card is convenient, hands down. It's a quick and straightforward transaction, saving you time and the hassle of arranging for financing through a bank or credit union. 🏃
• Potential Rewards: Many credit cards offer perks and rewards, such as cashback or travel miles. 💵 
• Consumer Protection: Credit card purchases often come with built-in consumer protection, such as extended warranties or purchase protection. This can provide peace of mind when buying a used car, especially when older cars are often a higher risk purchase due to needed or unexpected maintenance.

Are Auto Auctions a good deal? 🤑

Credit Card Cons: 😞

• Credit Limit: The biggest limitation when buying a car with a credit card is your credit limit. Most cars, even used ones, cost significantly more than the average credit limit, which is in the range of $4,000-$10,000 per card, and Americans have an average of 3 credit cards. You might not be able to cover the full cost with your card alone. And, buying a $4,000 used car when your limit is $6,000 is not the best idea. High credit utilization can negatively affect your credit score. You want to keep your utilization under 10%.
• Anyway, we’re not credit experts, we’re used car auctioneers. 😜
• Interest Rates: 🚨 This is a very important consideration, especially if you plan to pay off your car over time. Credit cards typically have high-interest rates compared to car loans.
• You can find out the average credit card interest rates online. They change all the time. Right now they are around 28% (which is kind of a lot if you ask me). Carrying a large balance on your card can result in substantial interest charges if you don’t pay it off quickly. 😬
• Car Dealers: Not all car dealerships (or auto auctions) accept credit cards for vehicle purchases. It's essential to check with the dealer beforehand to confirm their payment options.

And here’s where we should state plainly that Public Auto Auctions ACCEPTS all major credit cards!

Take a moment to look at our inventory. www.carstrucksandboats.com/inventory has hundreds of well… used cars, trucks, boats, and more! Plus, it’s such a good price! 🚗 🛻 🛥️

Buying a Car with a Credit Card

• Payment Process: If you plan to use a credit card for a car purchase, discuss the payment process with the dealer. Some may require you to pay a portion of the purchase price with another method, such as a cashier's check or wire transfer.
• Credit Card Fees: Be aware of any credit card transaction fees. Some dealerships may pass these fees onto you, reducing the benefits of using a card.
• Credit Score Impact: Large credit card transactions can impact your credit utilization ratio, potentially affecting your credit score. Make sure you can manage the increased balance without harming your creditworthiness. Plus, if you refinance the credit card loan after using the card, that might also negatively impact your score.

Did you know that Texas has the 3rd highest average credit card debt in the country?

Can you Buy a Car at Auction with a Credit Card?

Not at every auction, but you can at Public Auto Auctions. When browsing an auto auction, look carefully for what payments they accept. And please weigh the pros and cons of a credit card before you use it on a car.

Ultimately, the decision should align with your financial situation and goals, ensuring that you can comfortably handle the purchase without straining your finances.

Whether you are relying on a credit card for your used car purchase or not, check out Public Auto Auction’s inventory of cars, trucks, boats, and more! 🎉

P.S. Since 2001, Public Auto Auctions has striven to give back. Our partner CARS has processed over 75,500 donations and helped raise over $20,000,000.00 in profits for some great charities in Austin, Texas and beyond.