You may have heard of buy here pay here car dealers. But, do you know how buy here, pay here dealer financing works? If you have trouble securing a car loan then buy here pay here can be your option to purchase a car. It is a kind of in-house financing method offered by car dealers. Most of the time, this buy here pay here car dealers (BHPH) are the option for vehicle owners with a bad credit score.
How does it work?
In this type of car dealership, you will have the option of getting a loan from an auto lender. He will provide your car loan through the buy here pay here car dealer. BHPH car dealers have experience in working with people with bad credit. They arrange an auto lender to connect with the buyer to provide a loan. However, it is important to know that there are both pros and cons of this buy here pay here car dealerships. Although you will be a happy car owner even with a bad credit score, you will have some disadvantages once you purchase your car.
Pros of buy here pay here car dealers
Here are some pros of this method. Through this method, the bad creditors will get their loan approved. This will also help you to build your credit history. Also, the buy here pay here car loan process is simple and it takes short time. Once you drive off from the car dealer, your loan process is also completed.
Cons of buy here pay here car dealers
Don’t forget that this method comes with disadvantages as well. Although you will be a happy car owner, the costs are high. BHPH dealers may charge high rates because you are among the bad creditors. The interest rate can be higher as well. On the other way, car selections can be limited. Remember, you have to make a balance between your car loan and bad credits together with your car selection. There’s also a high chance of repossession if you fail to make payments.
Considering all these pros and cons, you can still consider buying a car through buy here pay here car dealers if you think you can make the payments as necessary.