In the Buy Here Pay Here Car Dealership

Many folks are not familiar with Buy Here Pay Here Car Dealerships until they have a dependence on them. The point of the article would be to shed some light along the way that the BHPH car lot and auto dealer operates and how they differ from the typical automobile dealer. I’ll give you a look in the BHPH business model and how they sell, finance, acquire and secure automobiles.

To provide you with some background the principal focus of the Buy-Here Pay-Here car dealer is to sell and finance vehicles for people that have bad credit and are unable to buy and finance automobiles through traditional dealers and lenders. They do this by selling used vehicles and financing them in-house or through the selling dealer. They don’t use banks, boat loan companies or alternative 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 Car Dealership

Some BHPH car dealerships are small corner lots that setup business in and old gas station or an auto repair facility as long as they have an office, a couple of bays where they are able to focus on or prepare cars for sale on the lot and a location where they can display their vehicles which are for sale. On another end of the spectrum you will discover 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 can come in all sizes and shapes.

Inventory for the BHPH Car Dealership

The tiny 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’re very particular about the cars they buy because they have to pay cash and they need a large number of cars to stock their lot and attract customers with a good selection.

The brand new car dealers that have a Buy Here Pay Here Department usually sell their quality trade-ins in their BHPH Division. It makes good sense to sell their trades with in-house financing because they have a steady way to obtain used vehicles at their disposal and they can avoid buying cars from the auction that is a very time intensive activity to get quality cars.

Irrespective of where they obtain vehicles they are careful to make sure they only offer sound and dependable automobiles since they will be financing their customer’s purchases. Should they were to sell junkers and beaters with their customer they stand a chance of the buyers not making their payments. Then if the customers don’t pay they will have to repossess the cars and they are 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 dealership.

THE PROCEDURE at the Buy Here Pay Here Car Dealer

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

Once they qualify for internal financing they discuss terms of the auto loan including the deposit, amount of payments, the interest and when and where the car payments should be made together with the form of payment which could be cash or checking account debit. The price is important, but the customer is usually more concerned with the payment.

Vehicle Selection at Buy Here Pay Here Lots

Then it really is time for the client to select a vehicle from the dealer’s lot. They are given a listing of the vehicles that they are qualified to buy and finance and they choose their vehicle of choice. Yes, that is different from your traditional car dealer, but things are done differently at the buy here pay here auto dealer. Some individuals say that the automobile is overpriced, but you need to remember that the BHPH dealer is about to finance a person with very bad credit and a small down payment.

The Buy Here Pay Here dealer is playing the odds and hoping the buyer can make the payments as agreed, but a particular percent of all the sales should be repossessed after the buyer has run the car into the ground. The automobile buyer with bad credit knows that they can be paying a high price for the automobile and an interest rate that is high to pay the dealer for the high risk and the expenses they will have to absorb when 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 the buyer and the dealer. The documents are all legal and conform to regulations which are set by the state when the car has been purchased and financed. The terms and conditions are set by the dealer and the buyer must conform to all those conditions or they are violating a legal agreement. The last thing you should do is be late together 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 in terms of enforcing the terms and conditions of the contract between dealer and buyer.

BHPH Auto Dealer Bad Deals, Repos and Mistakes

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

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