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5 Steps to Start Rent to Own

December 23rd, 2022

Opening a rent-to-own (RTO) car dealership can be a lucrative business venture, as there is a high demand for alternative financing options among people with less-than-perfect credit.

However, it requires careful planning, compliance with regulations, and a commitment to providing excellent customer service.

Here are some steps to consider when starting a RTO car dealership:

1. Research the market and competition

Look into the local demand for RTO car financing options, and assess the competition in your area. This will help you determine the best location for your dealership and the types of vehicles and financing options you should offer.

2. Obtain financing and secure a location

Starting a dealership requires significant capital for inventory, facility rentals, and other expenses. You may need to seek out investors or secure a loan to get started. Once you have the necessary funding, find a suitable location for your dealership, considering factors such as visibility, accessibility, and local zoning laws.

3. Set up your dealership

Once you have a location, you'll need to set up your dealership. This includes acquiring inventory, hiring staff, and establishing policies and procedures. You'll also need to comply with all relevant regulations, such as obtaining a dealer's license and meeting any state or local requirements for RTO dealerships.

4. Develop a financing program

A vital aspect of an RTO dealership is the financing program you offer to customers. You'll need to decide on the terms of your rentals, including the down payment, monthly payments, and interest rate. You'll also need to establish a system for managing payments and defaults, such as repossession procedures.

5. Market your dealership

Once you're up and running, getting the word out about your dealership is essential. This could involve advertising in local media, building a website, and networking with other businesses and organizations. You should also focus on building relationships with your customers and providing excellent customer service to encourage repeat business and positive word-of-mouth.


One potential advantage of an RTO dealership is the ability to offer a broader range of vehicles to customers. RTO dealerships may offer newer, higher-end vehicles that may not be available through traditional financing options. However, it's essential to carefully assess the risks and rewards of offering these vehicles, as they may be more expensive to purchase and maintain.


It's also important to carefully consider the terms of your RTO agreements. Some RTO dealerships may offer more flexible terms, such as the ability to return the vehicle at any time or the option to upgrade to a new vehicle after a certain period of time. These terms can appeal to customers but may also increase the dealership's default risk.


Opening a RTO car dealership can be a rewarding and lucrative business venture, but it requires careful planning and a commitment to providing excellent customer service.

By following these steps and staying mindful of regulatory requirements and business risks, you can successfully start and run an RTO dealership.

Joshua Aaron
By Joshua Aaron - December 23rd, 2022