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Buy Here, Pay Here



  • jlawrence01jlawrence01 Posts: 1,828
    I figure it this way. You pick out a nice low mileage '99 Taurus, it's $700 down, $75 a week, 78 weeks, total price $4995+ttl+interest, comes to $6400 altogether. You'd be making payments on that car, and say the transmission gives out after a few months. Now you have choices.

    Or you can go to Carmax and pay $8500 for the vehicle.
  • kyfdxkyfdx Posts: 27,652
    Geez... If I can afford $75/week, I'm just going to lease a new Accord.. :surprise:

    Prices Paid, Lease Questions, SUVs

  • geo9geo9 Posts: 739
    If you have NO cash or credit or are a "credit criminal"
    (thanks Terry aka R Royce) the BHPH lots are your only
    way to go !

    Those BHPH lots in Fl. sure made a ton of $$$$.........
    Sell a car that anyone with cash could buy for $2000
    to a person with a little cash and/or no credit for
    $1000 down and $60 or so a week for a YEAR.........

    You figure MOST can't or won't pay after several weeks.
    The car gets popped and resold to some other poor sap
    for the same deal...................
  • joel0622joel0622 Posts: 3,302
    Old saying of "You reap what you sow" comes to mind
  • Actually this is not how the system works at all. The first place where you are misguided is in what you think the dealer paid for the vehicle. Just because Kelly Blue Book or NADA tells you the "value" of the vehicle does not mean that is what the current market value of the vehicle is or what the dealer has to pay in order to get the vehicle. In most parts of the country your down payment merely covers the cost of t.t.&l on the vehicle. This isn't the 1970's and vehicles don't cost what your granpa paid. You are correct that you can take your repair money and buy at another dealer because they do not check your credit but the BHPH dealer you originally bought from may report to your credit and if you can suffer out what you think to be your cruel and unusual punishment of a car for the contract term that you agreed to, then you might actually be able to get into a better car the next time and take yourself out of this cycle. But I guess in the long run it is all a matter of your personal value system, how you were raised and whether you think everybody owes you something or if you are going to take responisibility for the bills you didn't pay in the first place the got you into this situation.
  • lemkolemko Posts: 15,120
    ...exhorbitant payments on a car on which you already hold the title. Here's an article from the Philadelphia newspaper on the evils of getting a car title loan : - titleloans.html
  • qbrozenqbrozen Posts: 17,148
    Bruce Johnson is trying hard not to lose his 2000 Dodge Neon. He and his wife, Helen, took out an $800 loan from Fast Auto Loans Inc. near Richmond. They've paid three payments , $533 , and still owe more than $900.

    Johnson is paying about $40 per month on the principal and about $200 in interest. If he stops, he'll lose the car. If he continues, he'll sink more money into the car than it's worth.

    "I'm paying $5,000 for a car that cost me $1,300, and if I get sick and miss a payment or can't make a payment they're going to come take my car away," Johnson, a 67-year-old retired carpenter, said in a telephone interview.

    Johnson now wishes he'd just gotten a payday loan. At least then, he says, he would have known what he owed. Either way, he said, legislators need to protect families like his from predatory lenders.

    Man, that just burns me up. Here a poor blue collar worker just trying to make ends meet is forced at gunpoint to take a handful of cash and hand over his car keys. When is the government going to step in and stop this victimization?!

    Reminds me of the time a banker came to the house and held a knife to my wife's throat while I signed documents to refinance our home. Anyone know a good lawyer that can help me out?

    '13 Stang GT; '86 Benz 300E; '98 Volvo S70; '12 Leaf; '14 Town&Country

  • tidestertidester Posts: 10,110
    When is the government going to step in and stop this victimization?!

    Not to sound unsympathetic, but the numbers in that article just don't add up.

    First, the current balance on the loan is greater than the amount borrowed ($900 vs. $800). How is that possible?

    Second, the article claims Mr. Johnson is paying $240 per month ($20 principal + $200 interest) but has already made three payments totaling $533 which works out to $177.78 per month. Which is it, $240 per month or $177.78 per month?

    Finally, if he's paying $200 interest per month on a loan with a balance of $900 then his monthly percentage rate is about 22%. which adds up to an astonishing 264% annual percentage rate. Even a predatory lending organization is required by law to inform the customer what the APR is along with the total amount that will be paid over the term of the loan. Mr. Johnson had to have been aware when he signed on the dotted line that the total cost of this $800 loan would be over $5,000.

    The government should certainly go after predatory lenders. However, I suspect the author of the article botched it and just didn't get her facts straight. And if the 67 year old Mr. Johnson was either completely oblivious to the tems of the contract into which he entered or was unable to coherently convey the facts to the author of the article then perhaps he ought not be driving in the first place.

    tidester, host
    SUVs and Smart Shopper
  • isellhondasisellhondas Issaquah WashingtonPosts: 17,599
    Thank you for doing the math I wa about to.

    No, this doesn't add up.

    It is a sad story and I feel for this guy especially at the age he is.

    Still, he put himself in this position either by not paying his bills or making some horrible decisions.

    This is when family support is needed. Hopefully this may be available to him.
  • bolivarbolivar Posts: 2,316
    In my state it could be a pawn shop loan.

    There are restricted to something like 35% PER MONTH interest rates.
  • mitzijmitzij Posts: 612
    I hope I'm never in a situation where getting a payday loan or mortgaging my car sound like good ideas. :sick:
  • isellhondasisellhondas Issaquah WashingtonPosts: 17,599
    Yeah, me too.

    Sometimes it's not the person's fault. A job loss or medical emergency can put a person over the edge.
  • qbrozenqbrozen Posts: 17,148
    You didn't miss my sarcasm, did you?

    '13 Stang GT; '86 Benz 300E; '98 Volvo S70; '12 Leaf; '14 Town&Country

  • blueiedgodblueiedgod Posts: 2,803
    Not to sound unsympathetic, but the numbers in that article just don't add up.

    I think you missed the sarcasm. He even said at the end that a mortgage broker came over and put a knife to his throat to refinance the house.... (sarcasm)
  • tidestertidester Posts: 10,110
    No, I did not. :)

    tidester, host
    SUVs and Smart Shopper
  • qbrozenqbrozen Posts: 17,148
    I didn't think so.
    Just checking.

    '13 Stang GT; '86 Benz 300E; '98 Volvo S70; '12 Leaf; '14 Town&Country

  • oldfarmer50oldfarmer50 Posts: 6,225
    I recently saw an ad on TV that said they would loan anyone $5750 "just because we trust you". In the small print that flashed for a nano second it said the interest rate was 99%. :cry:

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

  • joel0622joel0622 Posts: 3,302
    recently saw an ad on TV that said they would loan anyone $5750 "just because we trust you". In the small print that flashed for a nano second it said the interest rate was 99%.

    Wow, no one coud ever afford that loan. If they could they would not have to borrow in the first place.

    Wonder how they get around state usory limits :confuse:
  • the_big_althe_big_al Posts: 1,069
    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: 1,069
    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: 1,069
    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: 1,069
    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: 1,069
    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.
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