What Are the Pros & Cons of Buying A Car From Buy Here Pay Here Dealerships?

If you’ve been struggling with getting approved for a car you’ve probably heard about buy here pay here dealerships. And that’s about it, only heard…but there’s so much you aren’t sure about. What should I expect there? What if they’re a scam? How can I tell a good one from a bad one?

Get ready to dive into the world of buy here pay here dealerships and uncover the pros, cons, and neutral points to help you make an informed decision.

• Intro to Buy Here Pay Here Dealerships
• The Cons of Buy Here Pay Here Dealerships
• Neutral Points of Buy Here Pay Here Dealerships
• The Pros of Buy Here Pay Here Dealerships
• Making An Informed Decision
• FAQs About Buy Here Pay Here Dealerships

Buy here pay here car lots can be great for many people, however, they are not for everyone. Understanding the ins and outs of how they work will let you comfortably choose if buy here pay here auto sales are for you.

Buy here pay here dealerships, often referred to as BHPH, offer a unique solution for individuals who need help securing financing from traditional car dealerships. These dealerships finance car loans in-house, meaning they don’t rely on banks or third-party lenders. Instead, they approve loans directly to buyers, often without a credit check. 

Sounds pretty sweet, right? Well, it can be, but there are a few things you need to know.

If you need more information about how buy here pay here works first: What is Buy Here Pay Here Dealership in Fresno?

Everything in life comes with good and bad. Knowing the cons of something upfront can help you prepare for the full scope of what you are getting into. 

Higher Interest Rates

One of the biggest drawbacks of buy here pay here dealerships is the higher interest rates. If you have stellar credit, you’re used to seeing rates in the single digits. But if your credit score looks more like your bowling score, expect to see rates north of 20%. At a buy here pay here dealership you are working with 26% and up. 

Some BHPH programs, like ours, can offer 0% interest plans, depending on the type of payment plan you want to shoot for. But these are the exceptions, not the rule.

Limited Car Selection

When you finance through traditional routes, you can shop all around town for the exact car you want. But with BHPH, your choices are limited to the inventory on the lot. 

There won’t be specialty cars, sports cars, or luxury cars. This is because their focus is on providing you with a safe and reliable vehicle. You should go into it expecting to get the vehicle you need that will allow you to focus on building your credit and financial future.

The Need for Research

Just like you need to prepare for a more limited selection of vehicles, there is also more research to be done to prepare you for the dealership you are looking into. There’s a wide range of BHPH dealerships out there—from amazing to downright sketchy. 

You’ll need to do some homework to find a reputable dealer that reports to credit bureaus and stands by their offerings. Trust us, it’s worth the effort.

Here are some points that are neither good nor bad. They are just points that you should be aware of ahead of time to help you have a broader understanding of what you are getting at a BHPH car lot.

Tighter Loan Terms

BHPH loans come with tighter terms, designed to keep you on track and optimize your chance of success. If you’re someone who needs a little extra guidance to stay disciplined with payments, this is a great thing. However, if you don’t do well with extra attention, this might feel restrictive.

Practical Vehicles

As stated in the cons section, there are no luxury vehicles or sports cars at buy here pay here dealerships. Don’t expect to roll off the lot in a flashy sports car. 

Buy here pay here car lots focus on practical, safe, and reliable vehicles that help you build your credit. It’s like getting socks for Christmas—you need socks, but they’re not as exciting as a new bike.

The good stuff. The positives you can look forward to if you find yourself in a situation where an in-house financing dealership is what’s best for you.

Your Credit Score Doesn’t Matter

Whether you have a 300 or an 800, your credit score doesn’t factor into approval at buy here pay here’s. What matters is your overall financial picture and ability to make payments. 

They are more interested in you as a whole instead of the one factor of credit. This makes buy here pay here a viable option for those with bad credit or no credit.

Trade-In Options for Older Vehicles

Many traditional dealerships won’t touch an older vehicle with a ten-foot pole. They have very specific rules about the years and conditions of the cars they accept as trade-ins. Buy here pay here car dealerships, on the other hand, are more flexible with trade-ins, even if your car has high mileage or isn’t in the best condition. 

Say goodbye to the hassle of selling your car on Craigslist or Offerup. If you’ve ever tried that then you know exactly what we’re talking about!

Building Long-Term Relationships

At traditional dealerships, you can be just another sale. Once you drive off the lot, you probably won’t hear from them unless there is an issue. However, buy here pay here car lots aim to build long-term relationships with their customers. 

Since you’ll be making monthly payments directly to the dealership, they have a vested interest in your success. Therefore, they’ll make it a point to stay in contact with you throughout the life of your loan. 

Buy here pay here auto sales are there to help you on your journey and be a part of your team.

Customized Loan Terms

Buy here pay here loans are tailored to your specific situation, helping you stay on track and build good financial habits. Unlike the one-size-fits-all approach of banks, buy here pay here auto sales consider your unique needs and aim to help you get into a loan that will give you the highest chance of success.

Shorter Loan Terms

While traditional car loans can stretch out for a decade (hello, 12-year loans!), buy here pay here loans are typically shorter, ranging from 2-4 years. 

This means you’ll pay off your car faster and build equity quickly. No need to be old and gray until you finally get your title!

No Co-Signer Required

Tired of being asked to find a co-signer? At buy here pay here car dealerships, you don’t need one. 

The focus is on you and your ability to make payments, not on someone else’s credit score. They are interested in YOU and your financial success. 

Only if there is a special circumstance with someone who will be directly involved in helping you pay off the car and will be part of the loan will it even be brought up.

Related Reading: How to Get a Car Loan with Bad Credit

You now have all of the good, bad, and neutral points about buy here pay here dealerships. You should now have a good understanding of what you should expect at one and make a comfortable decision about them for yourself. 

It is always better to know what those are before getting into anything. Make sure to research what you need about any local buy here pay here cars near me or you and find out what will work with you and your situation. 

And if you’re in our stomping grounds around Fresno and know someone who needs help getting approved for their next vehicle and building up their credit/money skills in the process, we’d truly appreciate the referral. Our Drive and Thrive Program has got them. 

Not only would you be rewarded for it, but you’d also be helping someone improve their family’s lives and future. You can learn more about our Referral Partner Program here.

Related Reading: Buy Here Pay Here Near Me

Disclaimer: The information provided in this article is for educational purposes only. It is not financial advice. Always consult with a qualified financial professional for personalized guidance.