Buy Here Pay Here, an Alternative to Traditional Auto Financing

Buy here pay here (BHPH) dealers offer in-house financing, meaning you can buy a car and take out a loan from the same dealership. Getting approved for a loan through in-house financing is a lot easier than going through a special finance dealer that works with subprime lenders. But what makes a BHPH dealership different from traditional auto financing? Read on to find out.

What is a Buy Here Pay Here Dealer?

Buy Here Pay Here, an Alternative to Traditional Auto FinancingA BHPH dealer is also a lender, and because they offer loans in-house, they don’t rely on third-party lenders for financing. In addition, getting a BHPH car loan is usually easier than qualifying for subprime financing. Most of these dealerships don’t run credit checks, so your credit score doesn't impact your loan approval. Instead, the dealer looks for a steady income that can support a loan and a down payment.

Once you show you can afford a vehicle, you choose one you qualify for from their lot. You need to be aware that the cars available aren’t going to be brand new. You should check the vehicle’s history report, take a thorough test drive, and have a certified mechanic inspect it before making any decisions.

Is a BHPH Dealer Right for You?

Unsure if you should get financing through a BHPH dealership? Let’s check out some of the pros and cons of BHPH dealers:


  1. No credit check – They don’t care what’s on your credit reports or what your credit score is.
  2. Quick and easy process – In some instances, you can sign and drive off with a car in one day.
  3. Approval is income-based – As long as you have the income to qualify, your chances of approval are good.


  1. May not be able to improve credit – No credit checks sometimes means the dealership doesn't report loans or payments to the credit bureaus. This means you won't be able to improve your credit score. Ask about the dealer's reporting practices beforehand if improving your credit score is a goal you have.
  2. Interest rates are high – You can expect the interest rate to be higher than usual, raising the overall cost of the loan.
  3. Limited inventory – You may not have much variety in car selection, and some vehicles could be older models with high mileage or a spotty history.

At the end of the day, whether or not a BHPH dealership is right for you comes down to what you need, where your credit stands, and what you’re willing to pay.

Not Sure Where to Start Looking for Financing?

Whether you get an auto loan at a BHPH dealer or a special finance dealership, it’s important you pick one that can get you the best deal possible. But finding the perfect fit isn’t always easy, especially when your credit isn’t stellar.

Luckily, The Car Connection can get you there. We help people get matched with local dealers that are experts at assisting buyers in many types of credit situations every day. Submit our no-obligation car loan request form to get started today, and we'll get right to connecting you with a local dealership.

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