buy here pay here car lots near me are a great way to get into a new car without having to make a large down payment. The dealer will verify your income and where you live before matching you with a vehicle. You may not be able to choose the exact model you want, but you can still get a great deal.

Is buy-here, pay-here financing a good idea?

However, before you head to a buy here pay here car lot near me, be aware of the consequences of defaulting on your loan. Depending on your financial situation, repossession may hurt your credit score and make it more difficult to get approved for traditional dealership financing. This is one of the reasons why it’s a good idea to look for other ways to finance your vehicle.

Another drawback of buying a car from a buy here pay here car lot is that interest rates are usually higher than the legal rate in your state. In some cases, the car may even be more expensive than the market value. This can put you in a situation where you end up upside down in the loan, which may be difficult to recover from.

While some BHPH car lots are reputable, others are not. Be wary of those who churn the same car several times a year. A buyer might fall behind on payments despite the fact that the vehicle runs fine. If the buyer can’t make the payments, the dealer will repossess the car and sell it again, leaving the original buyer out of the money they paid for the car. While some buy here pay here car lots do report their payment history to credit bureaus, many do not. If the dealer has a website, you can find out whether they report their payment history to these agencies.