The abbreviation BHPH stands for “buy here, pay here.” It refers to a method of operating an automobile dealership where a dealer extends credit to customers for the purchase of a vehicle. BHPH dealerships offer a variety of credit options to buyers. Generally, BHPH dealerships offer lower interest rates than conventional car dealerships.
Offer Lower Interest Rates Than Conventional Car Dealerships
A buy here pay here loan requires monthly or weekly payments, which are usually made in person. As a result, it is important to note that these types of loans do not report your payments to the major credit bureaus. This could hinder your credit score if you miss payments or make payments late. Furthermore, buy here pay here dealerships may try to sell you a warranty or GAP insurance policy as a condition of the loan. These types of loans have different repayment schedules than conventional loans, and you may be required to pay higher monthly payments than if you would have paid the loan amount alone.
Another difference between buy here pay here dealerships and traditional car dealerships is the payment schedule. Many buy here pay here dealerships require weekly payments instead of monthly ones. While this might be convenient for those who get paid weekly, it also requires additional effort on your part to remember the payments. Some dealerships also offer limited payment options, so it’s important to check with the dealer to find out which payment option works for you.