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What are the risks of using a “buy here pay here” car dealer?
If you are looking into non-tradtional car loan options you need to know the risks of using a “buy here pay here” car dealer? This type of dealership is not always a bad option, but it can be and you need to prepare yourself for potential pitfalls.
Buy Here Pay Here Risks:
- Very high (sub-prime) car loan rates
- The dealership fails to report your ontime payments and your credit score does not improve
- Not all BHPH dealerships are ethical and they might sell you a lemon on purpose
These are all very important risks for you to consider and you must do your homework.
You need to know if you can afford an inflated APR. You must demand that the dealership report your timely payments to credit reporting agencies otherwise your credit score will not increase. You must ensure that the dealership is legitimate. Call the Better Business Bureau in your area to check if consumers have reported problems at a dealership you are considering.
Buy Here Pay Here dealerships are sometimes your only option left to get a car. This fact makes it essential that you prepare yourself for the risks involved in doing business in this market.
Auto Financing is an excellent place to begin your search for car financing options.
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