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Buy Here, Pay Here

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  • the_big_althe_big_al Posts: 1,073
    hmmm... well I agree with you "sort of" about throwing money away on a depreciating assest, but...... you need to drive, and it takes about 10k to get a decent reliable vehicle - you could drive a Hyndia Accent however - and so I don't think that spending 10k on a depreciating asset is "throwing it away". I look at it like an appliance. You buy a toaster for $15 dollars use it till it breaks and then buy a new one. You buy a T.V. for 200 bucks, it breaks in a few years and you buy a new one. A car I view almost the same way, although if it breaks I will definately not just run out and buy another - it depends on what breaks and how much I will have to spend to keep it road worthy.

    Right now I own a vehicle with 100K on it. By the time it was all said and done I paid about 17K for it. I financed it for 5 years 4 years ago, and paid it off in 3. I think the original price was 16K, but with added interest I think it came to about 17K. These are rough numbers here, I really don't know. Anyway, my point is, I have now put over 75K miles on it in the last 4 years (it had 25K when I bought it). I have had a few things go wrong, but all I think I have only spent about $500 in repairs in the last 4 years and 75K miles. I am about to spend another 1-200 in repairs next week. This is not including oil changes and tires and brakes of course. Anyway, my point is, I plan to drive this vehicle till the wheels practically fall off. I could be theoritcally driving it another 4 or 5 years putting hopefully the total mileage close to 200K. That would be nice. If I can get that much out of the vehicle, I would consider that original 17K money well spent. Sure the vehicle probably won't be worth much more than 1000 by the time I am done with it, but I sure was able get it's worth out of it....
  • the_big_althe_big_al Posts: 1,073
    Also I might dare say as I don't mean to offend - but if you can save 2K a month, why not save the 10K over the next 5 months to get 10K down payment and pay off the rest of the 5K over the next year? That would certainly start rebuidling your credit.

    Or is the 15K car not a Mercedes and therefore you don't want to be seen in that particular car? I mean even the above mentioned Taurus would do you well. It's cheap, reliable, and will help you rebuild credit. It aint a flashy car, or a "cool" car, but what's more important? Looking cool in a borrowed Mercedes or, or having a solid credit history that you worked hard to build?
  • the_big_althe_big_al Posts: 1,073
    Now that we are way off topic of the BHPH dealers, I will try and get back on topic.... :D

    There are a ton of them here in PHX Az. I'm not quite sure I would trust them and I have always had a bad feeling about them. I have never had an experience with one, so I don't know. The last 3 cars I have purchased have been through dealerships - one was used sight unseen which I will never do again, but it was a family business and I was desperate. Even my uncle tried to tell me not to buy this particular vehicle but it was what I wanted so he got off the auction for me. My next vehicle was a scant 1 1/2 years later from a dealership that took the wreck I had previously bought off my hands. It was also used and is still on the road 4 years later and still going strong. My last vehicle was bought new 2 years ago, and after experiencing it once, I think I will buy used again next time around. It was overall a better experience - as long as I can find the vehicle I want which can be difficult when buying used.

    I don't think I will ever see the need for me to use a BHPH place. But I do believe they fill a market need for those that can't get the financing from a dealership or a bank. Not that my credit is perfect, I have worked hard to get it to where it is now and had to pay a fairly high interest rate on the 2nd vehicle. (The first was financed through mom and dad and I just made the payments :)), but after it was paid for it really helped the credit and when I bought the new one a couple years ago, the dealership didn't even flinch. The rate still wasn't fantastic, but it was better and they didn't have to hunt down a lender like the first time....
  • the_big_althe_big_al Posts: 1,073
    so you have a hard time throwing 10K of your hard earned cash into a car but... you have no problem driving your fiance's Mercedes that either she/he (you never mentioned gender so I want to be PC :D) or her/his parents paid probably at least 3 times that with thier hard earned cash? And they don't even get to enjoy it? I think there is something wrong with that picture. I will put your words you said back into your mouth... suck it up, take the advice that has been given and get your own set of wheels that you can be proud to say you own.
  • the_big_althe_big_al Posts: 1,073
    I have a buddy who has bought his last 2 cars from a BHPH place and had a pretty good experience. Anytime he knew he was going to come up short, he would call them up and let them know and then he would also let them know when he would be able to make the payment. They were always cool with that....

    Also - is the BHPH lot reporting your credit so that you can repair your credit? Hopefully you are making all your payments on time and if the dealer is making reports that will help repair your credit.
  • HELLO I JUST HAVE A QUESTION ABOUT BUY HERE PAY HERE.. YOU GUYS SEEM LIKE YOU KNOW WHAT UR TALKING ABOUT.. I HAVE AN ACURA,PURCHASED 6 MONTHS AGO..115,000 MILES ON IT W/NO WARANTY.
    TODAY MY TRANNY WENT OUT, I TOOK IT TO A SHOP AND THEY ARE WANTING TO CHARGE ABOUT 3,000 BUCKS TO FIX,IS THERE ANY THING I CAN BRING TO THE DEALER'S ATTENTION ABOUT FIXING IT OR AM I S.O.L?
  • oldfarmer50oldfarmer50 Posts: 6,760
    "...W/NO WARRANTY..."

    First of all there is no need to shout, you're among friends here.

    If there is no warranty then Indeed you are S.O.L. What state are you in? Here in NY all dealers have to give a 30 day warranty. But even here after 6 months you'd be stuck.

    The only way the dealer will help you is if he's Santa Claus and you've been VERY good. You could still ask. Maybe he will give it to you at cost at his shop.

    If you don't ask, you don't get.

    2009 PT Cruiser, 2008 Eclipse, 1995 Mark VIII, 1988 GMC Van

  • exb0exb0 Posts: 539
    I am going to get beat up for this advice, but I’ll post it anyway.

    Since you are shopping at a BHPH store, it is save to assume that your credit very bad. In that case I would just let the dealer repo the car and go to another BHPH place to get something else. Just make sure you don’t put anything down.

    Now, if you have more than 3K invested in the car, and you want to keep it, then you are SOL.

    BTW, if you are shopping at a BHPH place, why are you buying luxury car? If you are that destitute then get yourself something cheap and reliable that is cheap to maintain.
  • carthellcarthell Posts: 124
    "BTW, if you are shopping at a BHPH place, why are you buying luxury car? If you are that destitute then get yourself something cheap and reliable that is cheap to maintain."

    Even with a car affordable to the ham-and-egger set, transmission work can be very expensive. I was pricing some new and near-new AT units for my vehicle, and the prices quoted didn't fall that much below the other poster's price (before installation costs, of course). Fortunately, nothing wrong was found with my transmission when I took it to the dealer for service.

    I'm glad to have found this thread. My brother wants to buy a Maxima within the next few months, and the auction places or local BHPH lots may be the only way he can buy such a vehicle. Please, if anyone has a story to share about your experience, post away! You never know who you're helping.
  • drake7171drake7171 Posts: 1
    I just found this discussion...interesting. It seems that many of the old stereotypes never seem to fade away. I am a second generation BHPH dealer in the D/FW area. We are celebrating our 25th Anniversary this year and have recently opened our 3rd location. I will attempt to set the record straight on a few issues.

    It is true that many BHPH dealers have a reputation of selling junk type cars....many do. But this segment has shrunk over the years as subprime auto financing has gained more steam. With vehicle prices always rising and down payments available to customers staying static, the old days of buying a $1000 car and getting a $1000 down payment are, for the most part, gone. Industry studies have shown that the most profitable vehicle for a BHPH dealer is one that is withing the $3000-5000 range. This is enough vehicle to have a decent equity down payment from the customer and a quality enough vehicle for the customer to have minimal mechanical issues with. This results in more customers being able to pay the loan off. Most dealers do not wish for customers to default so that they can repo the car. True, this may be profitable for the dealer at that point, but a smart business person will realize that they have terminated what could have been multiple sales over many years to that customer and his/her referrals.

    Some BHPH dealers do not fit the typical mold at all. My dealership for example. We handle mostly 2-5 year old vehicles with an average sales price of around $12,000. Many of those vehicles still have factory warranty. We also have a 10,000 square foot Service Center that inspects and repairs any and all issues any vehicle has before being offered for sale. This along with a free 90 Day / 3000 mile warranty give customers reassurance that they are buying a quality vehicle. it is true that the interest rates that my store offers are higher than bank rates, but most often we are cheaper than what Subprime lending companies offer to new car dealership customers on their used car loans.

    My advice: Do your research. As with any purchase, price should not be the key factor. Don't believe me? Ask some of the customers of many of these new car stores who traded their vehicles in right before they went belly up and the dealership failed to pay off the trade prior to closing shop.

    First and foremost, ask around. Find companies that have a track record of stability and a good reputation of taking care of their customers throughout the sales process.....and after. In the end, you will be much happier with good service than you will by saving a few hundred dollars by price shopping. Many of my customers do not question my prices any longer. They know I will be fair and that they will be treated well....and that is more important.
  • tidestertidester Posts: 10,109
    We are celebrating our 25th Anniversary

    It sounds like you're doing something right! :)

    tidester, host
    SUVs and Smart Shopper
  • delthekingdeltheking Posts: 1,152
    U are the exception than the rule.U are still at the higher end of selling cars.
    BHPH lots have clunkers with prices of 5-8k on cars which are actually 1-2k.
    And interest rates--well--24-26%
    U again,,are the minority here.The majority BHPH lots prey on poor credit.
    And their cars are in such a pathetic condition.
    It``s like---Beggars cant be choosy---Folks with poor credit have no option.Thats why they come to BHPH lots and are fleeced...
  • jipsterjipster Posts: 5,345
    As with any purchase, price should not be the key factor. Don't believe me?

    Well, not really. Price is always a key factor in whatever a consumer buys. There is always a small chance a dealership, jewlery store, furniture store will go belly up. Sure, look at stability, reputation and service... but none of that means anything if you don't have enough customers because you are charging too much.
  • isellhondasisellhondas Issaquah WashingtonPosts: 17,853
    If you charge too little you'll go belly up too.

    We wholesale a lot of cars to guys who operate small lots. Most of these guys have been in business for a long time. The cars they buy from us usually aren't "bad" cars. Just cars we don't want. I took in a nice looking and nice running 1996 Taurus Wagon a couple of weeks ago. I think it had around 100,000 miles. It's not the type of car we sell but I'll bet it'll make a nice transportation car for someone without a lot of money.

    BHPH lots vary in quality and ethics. For some people they are the only place they can buy anything.
  • Usually "your job is your credit". But I work for myself so I have no pay stubs from an employer. How much of a down payment do BHPH dealers need to finance me?

    25% of the price? 50%?

    I am looking for a truck in the $3,000 - $4500 range and I have $1000 to put as a down payment.

    Any info would be appreciated.
  • carthellcarthell Posts: 124
    You don't have pay stubs, but you do have quarterly tax return copies, right? I would think that would be sufficient basic documentation of your income.

    I would suggest going to your bank(s) first to get an idea of how you might be treated. Otherwise, I'd suggest that you try to save enough to pay the complete cost of the truck. (Consider that if you don't believe that you can save for the truck, how can you ever hope to meet the monthly payments on a loan?)
  • Kirstie_HKirstie_H Posts: 10,914
    Anyone else seeing a LOT more BHPH ads on TV in your local area? Apart from regional or national ads from manufacturers, I hardly see any dealerships advertising on TV these days, apart from the "we finance anyone" shops.

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  • sky23213sky23213 Posts: 296
    Seems to me that here, in the Mpls/St. Paul area, is business as usual. One of the BMW stores is quite regular, same with the families of dealerships. One of the Kia stores though is coming up regularly with creative and very screamy ads, almost to the point of being obnoxious. "Do have a job? Do you have XX dollars? You are approved!". :mad:
  • Kirstie_HKirstie_H Posts: 10,914
    I guess that's what I meant more than actual BHPH lots - I haven't looked up the advertisers to verify that they're BHPH (i just assumed they were), but it's always the same few dealerships (or used car lots) saying the same thing - one even says if you make at least $200/week, you're approved. That's crazy.

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  • Back to the days of easy credit? Is that not what got us into this mess? How quickly we forget.
  • carthellcarthell Posts: 124
    In the Baltimore area, mainstream dealers (those that have multiple stores and haven't gone bankrupt) are still chugging along. BHPH lots haven't advertised much, if at all, since late 2008/early 2009. Small, corner or storefront BHPH lots still operate. I'm assuming that inexpensive cars, word-of-mouth, and/or strategic alliances with a consumer group, such as a warehouse club or credit union, keeps 'em running.
  • jwilliams2jwilliams2 Posts: 871
    I see the same thing......seems a lot of dealers only advertise "we can get you a loan, even if you've been turned down elsewhere".

    The other ones I get a kick out of are the "Only $99 per month gets you in a brand new XXX of your choice". Of course the fine print at the bottom of the screen says "With $15,000 down payment plus, plus, plus".....

    I guess some people fall for that, cause the ads keep on rolling...
  • kyfdxkyfdx Posts: 30,443
    ..is hurting BHPH dealers more than the lack of sub-prime credit.... Used car prices are high..

    BHPH dealers are selling financing, really... But, they still have to have a car with loan value to complete the deal..

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  • lemkolemko Posts: 15,197
    edited July 2010
    ..if you make at least $200/week atyourparttimeMcDonald'sjobandstillliveathomewithyourwealthyDadwho'saventurecapi- talistandMomwho'sanOscarwinningactressandsupermodelandgetthembothtocosign YOU'RE APPROVED!!!
  • lemkolemko Posts: 15,197
    Yeah, it's $99 A month! The following 71 months it's $500!
  • steverstever Viva Las CrucesPosts: 41,550
    Are you a Southern California resident who recently (within the last 6 months) financed a new car purchase for more than 72 months? We're interested in learning more about your experience. Please drop us a note at pr@edmunds.com by Friday, June 14 2013.

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    Minivan fan. Feel free to message or email me - stever@edmunds.com.

  • Kirstie_HKirstie_H Posts: 10,914
    A reporter is looking to talk with someone who recently secured a subprime car loan. If you'd able to assist, please contact pr@edmunds.com by Thursday, October 24 2013

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