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Buy here pay here: Everything you need to know about buy here pay here financing


Owning a car is not a big deal for a middle man because there are several financing options available such as banks, credit unions, etc. But in case you have a low credit score to verify your car loan and no one is ready to give you a car loan than what will you do? Don’t worry here is a solution for you (BHPH) Buy here pay here.

Usually, a wide array of people don’t buy a car with hard cash, they used to borrow money to purchase a car from banks and other sources on a reasonable rate of interest. But if you have low credit score then traditional vendors will not approve your loan request and in that situation Buy here pay here is the one-stop solution for you. Buy here pay here dealer sell old cars and if you buy a car from them then you have to pay money to the dealers straight. Means your car seller is your financer too.

If you are not aware of this financing system and willing to buy a car with in-house financing (BHPH) then you have landed at the right page. I am here to describe the key aspects of this auto financing system so that you can decide whether you should go for it or not.

Buy here pay here: Everything you need to know
Pros and cons of Buy here pay here dealership

What is buy here pay here financing?

Normally when you want to buy a car from a traditional dealer then you visit the showroom and select your desired car. After it, the dealer shows your data to the third party lenders and they check it and if you get approval for the loan then monthly instalments are fixed as per your amount.

On the other hand in BHPH the dealer of the car is also the financer. BHPH dealers have lots of old cars and you don’t need to show them your credit record for buying a car from them. They will ask you to show your permanent residence address and income to pass a loan for your car. Dealers select the loan amount for you and after it, they show you the vehicles in that range.

But you have to pay a high rate of interest if you buy a car from BHPH dealers, maybe it will be in two digits.

What are the advantages of buy here pay here financing?

Although BHPH dealerships charge a high rate of interest, there are certain benefits for credit-challenged borrowers. Check them below:

  • If you have tired of visiting traditional lenders and they don’t approve your loan because of your poor credit record then BHPH dealership is the ray of hope to be the owner of a car. BHPH dealership’s approval measures are lower than the traditional ones so there are more chances of the approval of your car loan.
  • The whole process of buying and financing is quite simple when compared with the traditional dealership.
  • One of the big benefits of buying a car from a BHPH dealership is that you get the vehicle within your budget because after approval they suggest the vehicles that match your budget.
  • BHPH dealerships provide you with the several options of payment such as by text, by mail, by phone, and online.

Drawbacks of BHPH financing

After getting aware of the positive points of BHPH dealership let’s notice the cons of the in-house financing:

  • As I said above that BHPH dealers charge a high rate of interest because they deal with the people poor or no credit. So think before buying from the BHPH dealerships.
  • When you buy a car from the traditional dealership you will get unlimited options and there are no criteria to select your desired car. Whereas via Buy here pay here dealership you have to choose from the fewer options, they suggest you as per your eligibility.
  • As the BHPH facilitate vehicle to people with bad credit and thus they tend to require a huge amount as a down payment.
  • If you are unable to make timely payments to BHPH dealers then they will take back your car.

Should you buy a car from a buy here pay here dealership?

For me, it is a big no because buying a car from BHPH dealers is foolishness. There are many more options to buy your own vehicle as you can go for co-signer, or try to improve your credit record. If you buy from BHPH you have to pay more than the worth of the vehicle because of the high-interest rate.

Not only high interest but also you have to buy a car from limited options. So I suggest you before going to the BHPH dealers, preapprove your credit and confirm again. Cross-check different auto loans, maybe there will be an option for you.

Wrapping up

I think now you can decide whether you should buy your dream car from the traditional dealership or from the BHPH. The decision is your and my duty is only to aware you about the negative and positive aspects of a particular thing and here we discussed the BHPH financing.

How’s the post? If you found it informative then do share with your friends who are looking to buy a car but unable because of bad credit.

Your suggestions also required. What do you think about BHPH? Put your suggestions and queries in the comment box. We will feel great to add your suggestions and answer your queries as well.




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