Buy Here Pay Here Disadvantage

Written by Mark Hergert
Published on 28 July 2012 Hits: 6229

The "Buy Here Pay Here"


by Mark Hergert CEO

Some people mistakenly believe that they must visit a local “buy here, pay here” lot to buy a car with bad credit. But relying on such
companies is a recipe for vehicular and financial disaster.

Most of these companies charge interest rates exceeding 30 percent, which makes it very difficult for you to consistently make on-time monthly payments.

These companies hope that they will have to repossess the car so they can put it back on the lot, collect a down payment from another customer, and repeat the process to earn more money. True lenders such as Auto Credit Financial allow you to buy a new or used car in good condition regardless of your past credit problems.Yes, you will need to prove stable employment and residency.

In most cases, you will get better loan terms if you can trade in a used caror make a cash down payment. But you will not have to pay anywhere near 30 percent for an interest rate, even if you have a credit scorein the 400s. When you are buying a car with bad credit, a little flexibility is important. You might want a brand new BMW convertible but unless you make a healthy income, you will have a very hard time financing it with bad credit. Try a different model of new vehicle or a used BMW convertible if that is what you truly desire.

A good lender will work with reasonable requests, but they will not loan you more money than you can truly afford because they do not want to repossess your vehicle.

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Credit Information Before You Buy


After years of delays, the credit industry finally agreed to give consumers access to their personal "credit scores." This is important, because lenders use credit scores to determine who to give credit to and at what rates. Knowing your credit score can be empowering,If it's low you can take steps to improve your credit worthiness and if it's high you may be able to use it as leverage when shopping for your next car loan.