The credit markets have changed for reasons many don’t fully understand. This has led to the rise of buy here pay here. A few years ago, those with low credit scores could still get an auto loan if there was a substantial downpayment. But the rules have changed. These people will no longer be eligible for a conventional or sub-prime loan. Because people still need cars to live in modern society, the Buy Here-Pay Here (BHPH car lot) is the only option.
Car Dealers who Buy Here, Pay Here Traditional Car Dealers
Most people are familiar to the traditional car dealer. The dealer sells the used or new car and arranges financing through a third party lender. The buyer must have an acceptable credit score and past history to be eligible for auto financing. Also, the buyer should have a steady job or source of income sufficient to cover the installment loan. They will not be granted credit to purchase the car if they do not meet the criteria.
This is where the dealer who buys here pays here cars comes in. They run a business that operates exactly like its name. The customer will purchase from them and then pay them. This is a non-traditional car dealer that caters to those with bad credit and/or poor credit that are not able to obtain financing from the traditional car dealership. The BHPH car dealership offers in-house financing without the need for the buyer to apply to a lender. The car dealership basically sells and finance the vehicle.
The BHPH Solution for Car Buying
While buying a car through a buy-here-pay-here car lot may not be the most economical option for financing an automobile purchase, it might be the only one that you have if you cannot pay cash. The BHPH dealership specializes at helping people with credit issues due to job losses, divorce, and medical bills.
The first thing you should do is visit a buy-here, pay-here car dealer in your area to talk to a specialist about your auto needs. In-home financing by BHPH dealers isn’t as rigid as a traditional loan. Instead, the terms and car payments will be tailored to meet your financial limitations, requirements, and ability to repay. Typically, payments are made in cash at the dealership bi-weekly or weekly. Many people find this easier than paying a large monthly installment. Dealers that offer in house financing work with sub-prime lender and will gladly help you get a standard car loan. However, if this does not work out, the buy here, pay here solution is available.
For those who work with car dealers that buy here, pay here, a quick tip is to be aware that dealers can do many things and may have different requirements regarding financing.