Is a Buy-Here-Pay-Here Dealership Right for You?

Is a Buy-Here-Pay-Here Dealership Right for You?

Planning on buying a new car, but your shaky credit scores seem to get in the way? Don’t fret because you might be able to get one with a buy here pay here dealership.

A BHPH dealership allows you to purchase a used car in-house without relying on a third party for finances. Additionally, this dealership doesn’t even take your credit score into consideration. If you have a downpayment and stable income, you’re all set!

Related Article: Disabled Veterans and Car Loans: What You Need to Know

What Is a “Buy Here Pay Here” Dealership?

Before we move on to if a buy here pay here dealership is right for you, let’s start with understanding what a BHPH dealership is.

Usually, when you get under contract to purchase a car with a traditional dealership, they forward your application to a third party who checks whether you qualify for the loan or not. However, in the case of a BHPH dealership, your car is purchased and financed in-house. They don’t rely on a third party for finance. And, because no third party is involved, your credit scores are not considered, making it easier for you to purchase a car.

In addition to this, the entire process is actually quite simple. Unlike a traditional auto dealership, where it takes several days for loan approval, a BHPH dealership ends the moment you drive off the lot.

However, on the downside, a BHPH dealership costs more than a traditional dealership. Also, there might be limited choices, or you might be expected to pay a bigger downpayment.

Tip: Plug your numbers into a Veteran Auto Loan Calculator to see how much you can afford to spend on a car!

How Does a Buy Here Pay Here Dealership Work? 

As stated above, a traditional auto dealership relies on a third-party financing company responsible for the financing part of the company. So, all the applications opting for auto loans first go to this party, who figure out how much the applicant is eligible for, based on their credit scores and credit history.

A buy here pay here dealership, on the other hand, carries out the financing part on its own. This means that they offer their own terms for financing a vehicle. And in most cases, the dealerships don’t consider your credit score, making it extremely easy for you to qualify for the loan.

4 Steps to Get a Car at a Buy Here Pay Here Lot

Getting approved for a buy here pay here loan is easier than you think. Here are five steps to get a car through a BHPH dealership-

Visit a BHPH Lot

You can browse online to search for a buy here pay here dealership lot. However, make sure you choose a reputable business.

Choose a Car

While you might not be able to get the exact car you wanted, you are likely to find other vehicles in good condition and within your budget.

Submit Documentations

Once you choose the car, you must submit the documentation required for the financing of the vehicle. While the company won’t consider your credit score, you must be able to prove that you have a stable source of income.

Get Approved for Financing

After submitting all the required documents, you would likely be approved for the financing of the loan and the BHPH dealership.

Check out our article on VA Automobile Allowances!

Benefits of a Buy-Here-Pay-Here Dealership

Here are some of the benefits of a buy here pay here dealership-

No Credit Requirements

Unlike a traditional auto dealership, a buy here pay here dealership does not require an outstanding credit score to qualify for the financing. In fact, you can even qualify with a score as low as 500. All you need is a stable source of income and the required funds for the downpayment.

Easy Loan Process

These dealership loans are comparatively streamlined and require no-to-little qualification requirements.

You Can Trade Old Vehicles

In some cases, you might be able to sell your old vehicles and replace them with new cars. This will allow you to avail of exceptional discounts.

Disadvantages of a Buy-Here-Pay-Here Dealership

While this dealership comes with a couple of benefits, there are also disadvantages associated with it. Here are some of them-

Higher Cost

A buy here pays here dealership is often quite expensive. You might want to give four or five times more than a traditional auto loan.

Vehicle Tracking Device

In most cases, your vehicle will come with a vehicle tracking device.

Odd Payment Requirements

These dealerships often come with odd payment requirements. In some cases, you might be required to pay weekly or in person.


A buy here pay here requires you to pay a bigger downpayment, which can be a little difficult.

Limited Selection

Through a BHPH dealership, you might not be able to get the vehicle you actually wanted.

Related Article: How to Get a Car Fast as a Veteran

How to Spot Buy-Here-Pay-Here Scams?

For many, words like “no credit requirements” can be a saving grace. However, it might be too good to be true. While valid BHPH dealerships exist, there are several that are actually run by fraudulent organizations.

So, how do you spot a buy here pay here scam? Here’s how.

  • A fraudulent organization might ask you for your account credentials to transfer the money. However, after a few days, they might claim that the transfer was unauthorized and ask for money and the car.
  • They might ask you to log into a mobile banking app and open your account through this app.
  • They might overpay you intentionally.

Is It Right for Me?

When your options are limited, a buy here pay here dealership might seem like a fantastic opportunity. However, if you have a fair credit score, it is recommended to opt for a traditional auto dealership. Through a BHPH dealership, you might not be able to get the car you actually want and end up paying almost double that in the long term.

It is best to wait and work on your credit score in most cases rather than spending four or five times more than you usually would have with a traditional dealership.

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