What Is a Buy Here Pay Here Dealership?

Big banks discriminate. To make sure they can profit on a loan, traditional lenders extend credit to low-risk, creditworthy borrowers.

Buy here pay here dealerships are a common alternative to financing your new car with a traditional lender. The rules for approval are much different and can be a huge win as long as you understand the process.


Most car dealerships are in the business of cars, not financing. They maintain a large inventory of vehicles to appeal to a range of buyers.

At buy here pay here dealerships, the car dealership manages both vehicle inventory and issuing auto loans. 

You get your loan terms and car keys on the same day without having to wait for paperwork in the mail. It’s a quick and convenient way to streamline the purchase process and get you into a vehicle faster.

When your car breaks down, a quick online search for ‘buy here pay here dealerships near me‘ can show you how to immediately get back into reliable transportation.

Loan Terms

The buy here pay here dealership takes on a risk when extending credit. Most don’t require buyers to have good credit before they’re given an auto loan. 

This makes it easy for buyers, but risky for the lender. To make sure they make their money back on the loan, interest rates and fees are often higher at buy here pay here dealerships. 

With fair to good credit, buyers can expect interest rates in the single digits as low as 3.9%. Buy here pay here dealerships commonly charge as much as 20% interest on auto loans.

The higher fee allows the lender to ensure the balance of the loan is repaid because they recoup profits early in the loan term. 

Down Payment

Buy here pay here dealerships usually ask for a down payment towards the purchase price of the car. Prepare by bringing up to 20% of your expected purchase price to the table.

Down payments are another way the dealership lowers risk. When you pay a substantial amount in advance, you’re committing financially to the loan terms before driving off the lot.


The major benefit of a buy here pay here dealership is convenience. Bad credit happens for a variety of reasons, but that doesn’t stop your need to live your life.

One of the best ways to repay your debts is having a stable income. Buy here pay here dealerships give you access to reliable transportation with little hassle. 

This transportation means getting to work on time so you can continue to repay your debts and boost your credit score over time. Once your credit score increases, it might be possible to refinance your auto loan for a lower interest rate and lower your payments.

The Buy Here Pay Here Dealership

There are pros and cons of getting your next car from a buy here pay here dealership. However, with bad credit or no credit, you have few options.

The good news is that you can make the loan terms work for you by making your payments on time and getting a vehicle within your budget. 

For more information on finding dealerships in your area, please check out our website. 

Author: Brandon Park