Buy Here, Pay Here dealers (BHPH dealers) offer service to those car buyers who don’t have good credit, but badly needs a car. If you are considering this option to buy a car, then you should keep the following things in mind.
They are selling a loan
You should know that they are selling you a loan at high interest rate. You can expect 18 to 21 percent loans or even higher. This form of financing is expensive as sellers assume that you are going to default on your loan.
They will know your every move
When you buy a car from BHPH dealer, you consent to have a GPS device installed in the car, and you won’t be able to remove it. The dealer will want to know where the car is if it has been repossessed. Some dealers install devices that disable the car.
You should go to the dealers who report payments
You should report your payments to credit bureaus so that you can rebuild your credit. If you don’t report it, you might get punished. You should try to restore your credit worthiness at all cost.
Get your car inspected
Before you buy a car from BHPH dealer, get an independent mechanic to inspect the car. You should buy a car in good condition so that you don’t have to spend too much money on maintenance costs
You should buy car with less money than you can afford
The BHPH dealer will try to sell a high priced car to you, but you must resist the temptation. So, if you can afford to pay to say $500 a month, buy a car that will cost you $400 a month. You should save the rest of the money for car maintenance or down payment for buying a new car.
You should try to pay off the loan as soon as possible. There is nothing more relaxing than paying off the loan earlier. You can then think of buying another car or making other important investments in life.