Inside the Buy Here Pay Here Car Dealership

Many folks are unfamiliar with Buy Here Pay Here Car Dealerships until they have a need for them. The point of the article is to shed some light along the way that the BHPH car lot and auto dealer operates and how they change from the standard automobile dealer. I will give you a look inside the BHPH business model and how they sell, finance, acquire and secure automobiles.

To give you some background the primary focus of the Buy-Here Pay-Here car dealer is to sell and finance vehicles for folks which have bad credit and are struggling to buy and finance automobiles through traditional dealers and lenders. They do that by selling used vehicles and financing them in-house or through the selling dealer. They don’t use banks, finance companies or third party lenders. Their customers buy the car and make the weekly payments at the same place, hence Buy Here Pay Here.

Setting-Up the Buy Here Pay Here DEALERSHIP

Some BHPH car dealerships are small corner lots that setup business in and old gas station or a car repair facility as long as they will have an office, a few bays where they are able to focus on or prepare cars on the market on the lot and an area where they can display their vehicles that are for sale. On the other end of the spectrum you will find that some new car dealers set-up a Buy Here Pay Here division along with their regular car sales business to accommodate customers that won’t qualify for an auto loan through their normal lenders. So that you can note that BHPH car dealers will come in all shapes and sizes.

Inventory for the BHPH Car Dealership

The small to mid-size BHPH car dealer is definitely on the lookout for vehicles to sell on the lot. They go to auctions to buy cars, buy cars from private party sellers plus they also buy cars from new car dealers that were trade-ins. They are very particular concerning the cars they buy because they need to pay cash plus they need dozens of cars to stock their lot and attract customers with a good selection.

auto sales near me The brand new car dealers which have a Buy Here Pay Here Department usually sell their quality trade-ins within their BHPH Division. It makes good sense to market their trades with in-house financing because they have a steady source of used vehicles at their disposal and they can avoid buying cars from the auction which is a very frustrating activity to find quality cars.

Irrespective of where they get their vehicles they are very careful to be sure they only offer sound and dependable automobiles because they will be financing their customer’s purchases. Should they were to sell junkers and beaters to their customer they stand a chance of the buyers not making their payments. Then if the clients don’t pay they have to repossess the cars and they’re stuck with vehicles that are unsellable because they’re junk. So you can see why they are very particular concerning the cars they sell and finance at their Buy-Here Pay-Here car dealership.

The Process at the Buy Here Pay Here Car Dealer

The initial step of the car buying process at the buy here pay here auto dealer is to see if the customer can qualify for internal financing. Some dealers pull the consumers credit file and some don’t, one of the main concerns may be the income and the stability of this income of the buyer along with where they live. The BHPH car lot owner is looking for a person that comes with an income that may service the car finance weekly or biweekly and just how long they have been on their job. These aspects are often more important than prior repossessions or bankruptcies.

Once they be eligible for in house financing they discuss terms of the auto loan including the deposit, number of payments, the interest and when and where in fact the car payments should be made together with the form of payment that could be cash or bank checking account debit. The price is important, but the customer is normally more concerned with the payment.

Vehicle Selection at Buy Here Pay Here Lots

Then it is time for the customer to select a vehicle from the dealer’s lot. They’re given a listing of the vehicles that they are qualified to buy and finance and they choose their vehicle of preference. Yes, that is not the same as your traditional car dealer, but things are done differently at the buy here pay here auto dealer. Some people say that the automobile is overpriced, nevertheless, you need to understand that the BHPH dealer is approximately to finance a person with very bad credit and a little down payment.

The Buy Here Pay Here dealer is playing the chances and hoping the buyer can make the payments as agreed, but a certain percent of all the sales will have to be repossessed after the buyer has run the automobile into the ground. The car buyer with bad credit knows that they can be paying a higher price for the car and an interest rate that is high to compensate the dealer for the high risk and the expenses they have to absorb if they repossess vehicles.

Buy Here Pay Here Car Dealer Paperwork and Conditions

Preparing and signing the paperwork is done in the dealer’s office that is a contract between your buyer and the dealer. The documents are legal and comply with regulations that are set by hawaii when the car has been purchased and financed. The conditions and terms are set by the dealer and the buyer must conform to those conditions or they’re violating a legal agreement. The last thing you should do is be late with your payment because the car can be repossessed the following day. Grace periods for late payments are rare and the BHPH car dealer is at their rights to seize the vehicle one day after the payment is late. In ways there exists a zero tolerance policy with regards to enforcing the terms and conditions of the contract between dealer and buyer.

BHPH Auto Dealer Bad Deals, Repos and Mistakes

Even the best run dealers will make bad deals, mistakes and also have to repossess vehicles. They are careful to accomplish everything they can to avoid problems, but it still happens. Should they have to repossess a car they have to hire a recovery firm that may cost several hundred dollars and they need to do something with the car. Frequently the car has been in an accident or been run hard and set aside wet which makes the car worthless and ready for the scrap yard. It is extremely rare that a repossessed car comes home in good shape. The Buy Here Pay Here Car Dealers takes it on the chin and loses money, but hopefully learns a lesson with regards to qualifying buyers.

Buying a car from a BHPH car dealerships differs than doing business with the traditional dealer in several ways, but it is really a second chance or possibly the last chance for the car buyer with bad credit. A few of the policies and terms might seem unfair, but even the small dealer can have thousands of dollars tied up in inventory and finance agreements. They are putting themselves on the line to help the car buyer that needs a car, but includes a history of spotty credit. It’s just business.