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Misconceptions about Buy Here Pay Here Dealerships

January 6, 2020

Bad Credit leads to the loss of various opportunities at the time of ongoing deals but buys here pay here dealerships got you covered as they provide finance to the person who has held bad credit score. Buying a car is a huge decision which includes looking for finance, different payment plans, etc.

There are some misconceptions which consumers have regarding the buy here pay here dealerships, let’s have a look at first these misunderstandings so next time you won’t repeat the same.

Higher rate of interest

They charge more than the banks and other financial institutions as they charge more than the average as they provide loans to those people who have bad credit scores. They focus on those customers who hold bad credit score as financing these people involve a huge level of risk.

These dealerships charge more than 30% in the interest rate which is higher but they cannot help towards the same as the interest varies from state to state.

Higher down payment

Earlier when the concept was taken the birth they used to charge money which is similar to the value of the car. Nowadays, this doesn’t work people are more and educated on the fact that down payment and financing work. These dealerships came into existence to provide loans to those people who hold bad credit scores.

car dealer

No warranties associated

Buy here, pay here dealership does not offer guarantee or warranties which makes the buyer think twice before indulging with them as there is no protection. The hype in the used car market has made the state to ask the dealer to provide warranties if they buy a car through buy here pay here dealerships.

Late monthly payments lead to additional charges and repossession of the car

Like bank charges an additional charge if you don’t pay timely monthly payments. BHPH dealerships repossess the car from the customer is the result of not paying frequently monthly payments. As a matter of fact, dealerships lose more money when they repossess the car as their value declines as again and again re-selling lower down the price.

Not regulated Dealerships

Consumers have a perspective that BHPH is an unregulated industry but they also operate with proper rules and regulations which state has created for them and they are bound to follow them. They also have some ethics and regulation in order to deliver quality products and services.