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Buy Here Pay Here Dealers

Separating Myth from Reality Regarding Buy Here Pay Here Dealers

When it comes to buy here pay here dealers, there seems to be a lot of speculation and myth swirling around. Some would have you believing that BHPH companies are greedy, money hungry demons looking to take advantage of you. In truth, BHPH lenders are nothing like that. In fact, they can offer you a measure of convenience that convention dealers cannot. The best way to tell if a buy here pay here lender is right for you is to separate the myth from the reality.

Myth #1: BHPH Lenders Charge an Arm and a Leg in Interest Rates

It is surprising how many people believe that the majority of BHPH auto companies will charge you 30 percent or more in interest when that is simply not the case. Although some companies will charge the maximum allowable interest rate within their state, most understand that financial difficulties happen to everyone. For that reason, these specialized lenders are willing to help you in your time of need.

It is true that Buy here pay here dealers charge a higher interest rate than convention auto dealers and banks, but the interest it only slightly higher. If you think about it, most of the people who have to use a BHPH lender has deep subprime credit, which translates to significant financial issues. In fact, Edmunds states that deep subprime credit entails anyone with a FICO score of 550 or less. Therefore, a slightly higher interest rate is not all that unreasonable since the lender is taking a chance in helping you get into a car you need.

Myth #2: The Down Payment is Far Too Much

Just like with the interest rate, BHPH professionals may ask for a little bit more than a traditional car dealer when it comes to a down payment for a car, but they will not try to stake a claim to any of your appendages or even your first born child. In fact, many professionals are willing to work with your unique financial situation. In other words, they will work within your budget restrictions to help you find a vehicle with a down payment amount that you can afford.


Myth #3: You Are On Your Own if Something Goes Wrong with the Vehicle

The statement above is extremely far-fetched. If you are driving your BHPH car around and it happens to breakdown, the company you are buying it from generally has warranties in place that cover such issues. There are companies that many ask you if you would like to purchase additional coverages and warranties for an added price, but you are never left completely without any form of help or coverage.

It is highly recommended that you purchase additional warranties when you first to buy a car. Adding extra warranties may cover other damages not included in the lender’s base warranty. In essence, adding additional guarantees will cost your more money a month, but it will also save you money in the event something happens to your car.

Myth #4: A Late Payment Results in the Immediate Repossession of Your Car

Just like with any financial institution, buy here pay here dealers expect to receive their money on the date that it is due. That is not to say that a late payment will result in the immediate repossession of your vehicle. If you know your payment is going to be late, make sure you contact the dealer to make them aware of your situation. Unless you are more than a month or two behind, they will be willing to work with you so that your vehicle does not get repossessed.

Myth #5: You Would Be Better Off Working with a Conventional Auto Dealer

There is nothing wrong with conventional auto dealers, but if your credit score is suffering, you certainly would not be better off working with one. In fact, if you have negative marks on your credit report, it is likely that you would be denied a car loan through a traditional lender or car dealer. BHPH auto dealers, on the other hand, often approve those with even the worst credit possible.

Many BHPH car companies do not run a credit check, which is why you can get approved for a vehicle even if your financial history is damaged. Because of the lack of a credit check, you are more likely to get into a vehicle that you want and need with a BHPH car lender than you are if you were to go through a traditional auto loan company.

 Now that you know the truth behind buy here pay here car companies, you should schedule an appointment to go speak to a professional. They can answer any questions you have and put your mind at ease regarding all of the myths you may have heard. In fact, once you speak to a professional, you are likely to find that they are friendly, accommodating, and willing to help you secure a vehicle in no time.

How to Buy and Maintain a Very Inexpensive Car,” Ronald Montoya, Edmunds.


Buy Here Pay Here Dealers - Car City

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