Financial Struggles of Everyday Living and How Buy Here Pay Here Dealerships May Be Your Salvation

July 27th, 2018 by

A smiling couple is going over loan detail with a salesman at a buy here pay here car dealership.

Of all the hard and unexpected truths we discover as we grow up, perhaps the roughest is this: being an adult sucks. Not all the time, of course, but there are plenty of times when having to be responsible, do grown-up things, and just generally live as an adult can be a bit more difficult than we expect as a kid. A lot of this comes from the fact that once we’re adults, we still don’t have all the answers – we make mistakes, we mess things up, and sometimes there can be consequences for those things. The kinds of consequences that end up with us needing a Buy Here Pay Here loan when we’re looking for a car.

Fortunately, being an adult doesn’t always have to suck, and even when things go wrong, there are a lot of possible solutions out there. Take the aforementioned BHPH financing, for example; yes, it is more restrictive than a conventional loan from a bank, and the interest rate is higher, but it’s also an opportunity to improve. Whereas something like bankruptcy leaves a dire shadow on your credit for many years, a BHPH loan actually helps you rebuild your credit and improve your situation. Let’s take a look at how you might have ended up in this situation in the first place and some of the ways that BHPH financing can be very fortuitous.

How People End Up with Bad Credit

Having bad credit can feel like a punishment; shopping for a car when you have bad credit can leave you feeling like a leper. The judgmental looks, the limited selection, being turned away again and again for loans – we understand, and we’re here to help. One thing we understand is that there is a wide range of reasons why someone can end up with bad credit.

For a lot of people, bad credit can happen due to things completely out of your control. We’ve worked with customers who had parents or other trusted adults use their information when they were younger to get lines of credit or for other financial ventures that fell apart. This meant these people had bad credit before they even had a chance to figure out finances as an adult – it was completely out of their control. Other customers have come to us after serious medical issues, accidents, or other catastrophic life events that left their credit in ruins.

And for some people, bad credit is the result of their own actions and mistakes, typically those that occur early on in adulthood. We all do dumb things in our 20s; if we’re lucky, no one gets hurt, and the consequences are minimal – but sometimes, you can end up with long-term issues due to poor financial decisions in youth. But here’s the thing: everyone makes mistakes, and everyone deserves another chance to set things right and fix those mistakes. That’s where a Buy Here Pay Here loan can be advantageous, as long as you take advantage of it.

The High Cost of Living

Here’s the other aspect of ending up with bad or poor credit: being an adult is expensive. Most of the customers we work with were never offered classes growing up to teach them how to budget, how to figure out their finances, and what decisions to make to ensure the best use of their money. So they grow up, strike out on their own, and unless they were lucky enough to have parents who taught them how to manage their funds, mistakes get made.

Figuring out how to set and manage a budget is something everyone should learn, and yet it doesn’t seem to be a priority in most schools. Rent, utilities, your phone and internet bill, buying groceries and going out to eat, buying clothes, paying for occasional entertainment and other luxury items – all of these things add up fast. By the time you add on payments for a vehicle, insurance, gas, and maintenance, unless you’ve budgeted properly, you can be in big trouble. This can set you on the road for financial trouble and bad credit – which is where a Buy Here Pay Here loan often comes into play to set you on the right path.

A keychain and fob are shown on top of approved car loan paperwork.

What Does “Buy Here Pay Here” Mean?

With a traditional loan, you go to a dealership, find a vehicle you want, and then apply for a loan from a third party like a bank to help you pay for it. If you have good credit, then that works well, and you’ll probably have a good time while shopping for a car. But if you have poor credit, then you’ll have a hard time getting approved for a loan, and the process can leave you feeling utterly defeated. That’s where Buy Here Pay Here comes into play.

A BHPH loan is offered by the dealership you’re at rather than by a third party. There’s usually no credit check involved, so you don’t have to worry about having bad credit, and financing is basically guaranteed as long as you have proof of income and a permanent address. You then repay the loan to the dealer, making your payments directly to them, so you never have to worry about some other lender entering the picture.

Pros and Cons of BHPH Financing

Even though Buy Here Pay Here financing is a great choice for some people, it’s not right for everyone – but then again, nothing is. There are some potential pros and cons to consider, so keep these in mind when figuring out the right way to pay for your next car. They include:


  • No credit check involved – guaranteed financing
  • One-stop shopping that makes the process simple
  • Help with rebuilding bad credit


  • Higher interest rates
  • Payments may need to be made in-person
  • There may be strict terms for late payments

As you can see, some of these are very important. Just like any other kind of loan, BHPH financing is a big decision, so be sure to think it over carefully and make the choice that’s right for you. Don’t be afraid to ask questions while figuring out your financing, and always shop with a dealer you can trust.

A set of keys is shown dangling from a door handle of a car at a buy here pay here car lot.

The Key to a Bright Future

While all of the pros we mentioned above are important, we wanted to take a moment to review one of them in greater detail: how a BHPH loan can help you rebuild your credit. The key to having good credit rather than bad is not to have excessive debt and to make payments on loans and credit cards on time. When you first take a BHPH loan, there might be a slight ding to your credit score since you’re increasing your debt, but it won’t be much. From there, however, you have a great opportunity to improve your credit.

You do this through one simple thing: make your payments on the loan on time, every time. Late payments can hurt your credit rating, and missed payments or defaulting on the BHPH loan will really harm your score. As long as you’re making your payments on time, however, you’ll see your credit score start to go up over time, and this can make things a lot easier in the future when you apply for your next car loan or if you want to buy a house. Just make sure you choose a dealership that reports your payments to the major credit bureaus to ensure that your efforts are rewarded, and you’ll see your credit score improve.