Just because you have bad credit doesn’t mean that you’re automatically disqualified from getting a car loan. You can try and get an auto loan through a subprime lender, but a buy here pay here (BHPH) dealership is another option to consider.
How BHPH Dealers Are Different
Similar to subprime lenders that work with bad credit borrowers, buy here pay here dealers work with those struggling with credit. These dealerships ask that you provide proof of income and a down payment, and they’re going to qualify you at a higher than average interest rate to offset your poor credit.
However, there are some key differences you need to be aware of before you head to one of these dealers:
- BHPH dealerships are also lenders – These places make loans in-house, so they’re both lenders and dealers. Subprime lenders only offer loans, they don’t sell you a vehicle.
- Credit requirements differ – Subprime lenders run credit checks, where BHPH dealerships usually don’t. Some BHPH dealers may use your credit to qualify you, but they let you know up front if they do.
- Requirements to qualify are different – Since BHPH dealerships typically don’t run credit checks, they use your income and down payment to qualify you for a loan. Income requirements vary, but expect a minimum monthly income requirement around $1,500 to $2,000 before taxes. The down payment requirement generally depends on the vehicle you pick, so it varies from dealer to dealer.
What Are My Vehicle Options at a BHPH?
You now know that your down payment depends on the vehicle you pick at a buy here pay here dealership, but what exactly are your options? BHPH dealers only sell used cars – you aren’t going to find any brand new vehicles on one of these lots.
You may be able to find a year-old vehicle with under 10,000 miles, or you may find a car that’s closer to 10 years old with more than 100,000 miles on the odometer. Each BHPH car lot is different, with a wide range of vehicles for you to choose from.
What you need to remember is that you likely aren’t going to find the car of your dreams, so you should consider which vehicle is going to work best for your budget and driving needs.
The Bottom Line
Don’t let bad credit hold you back from getting the car you need. If you need assistance with credit repair, our trusted partner can help, and we can also help you find a special finance dealership or buy here pay here near you to work with.
At The Car Connection, we work with dealers all over the country that specialize in getting people financed who have bad credit, no credit, or even a bankruptcy. When you’re ready, you can complete our auto loan request form, and we'll get right to work matching you with a local dealership.