The Buy Here-Pay Here industry is relatively tough for consumers to wrap their heads around. After all, the incredibly high interest rates seemingly hurt the customer more than they help, and this strategy tends to challenge the public perception of these individual businesses.
We could go on and on about why consumers shouldn’t write off BHPH dealerships, but this advice ultimately falls on deaf ears. Instead, we’ve decided to pull opinions from actual “insiders” who understand the workings of these dealerships. We’ve collected some notable quotes below from Reddit, and these tidbits of information should help you better understand the entire workings of the industry (as well as provide you with some clever negotiation tactics). That way, when you’re ready to purchase a vehicle, you won’t be afraid of visiting a Buy Here-Pay Here dealership…
u/Vroonkle understood the issue that some consumers may have with the Buy Here-Pay Here industry, but he also noted that many of these businesses are operating under ethical mindsets. For instance, his friend’s dealership does provide financing to their customers, but they’re more focused on securing a vehicle for their clients than trying to “steal” all of their money:
“The other small dealer he sold for I actually liked a lot. It was a younger guy who had some family money. He bought optioned out cars to start, and once he secured financing he started selling luxury cars exclusively. They would buy problem vehicles and repair and detail them back to like new. He still turned a hefty profit, but his version is what I consider ethical small car dealership practice.”
Meanwhile, u/Poon-Toon defended Buy Here-Pay Here dealership’s willingness to purchase many of their vehicles via auction, noting that the businesses still have to invest plenty of money into these individual vehicles to assure that they’re working properly:
“I own a dealership with my brother, and to be honest I agree that many dealers are bad. But this is simply an uninformed and in general worthless comment. We do buy auction cars at auctions, yes, however they’re auctions that only dealers can go to. Often times cars bought at auctions need reconditioning to some extent which we handle and keep record of, something that would be difficult for someone who doesn’t have connections to shops that price lower to businesses. And to be honest a smaller lot that’s ethical and logical tends to price similar to private sellers with maybe a small upcharge. You also get the protection of rules and regulations the government has put in place that apply to dealers but individuals can blatantly ignore. Find a dealership that does safety and emissions inspections at a trustworthy shop, make sure you aren’t afraid to walk away if the price isn’t right, and be diligent.”
If you’re in the situation where you might be trading in your current ride for a replacement, u/s_x_i, who owns a dealership, provided users with several clever negotiation tactics:
“The thing is, dealers can buy at wholesale, so it makes no sense to me to pay over that for a trade in. Guys who come in wanting $10k on trade for a car I can buy all day long for $7,500 down the road are going to have a bad day.
Look up your trade values online, KBB and NADA, know what it’s worth on trade in before you go to the dealer. Is it worth it to you to take the trade and tax differential, or would you rather mess with customers on Craigslist and try to come out ahead? A lot of the time people trade because they don’t want the headache.
If you want the best price for your trade, negotiate the price of the car you want to buy first – separately. Only when you have a price you’re happy with do you want to bring up the trade. If you don’t do that and I know you’re aggressive on your trade in price, I can show you more than I want to give, then absorb the difference by not moving on the sales price any.
This is extremely easy to do with uneducated “payment buyers” All they see is their car going away, a new car to play with and their payments only going up $50 a month. Sigh…”
u/Ahumbleelitist added to these suggestions, noting that dealerships are particularly focused on finding a fair deal for their customers. While their initial offer may seem a bit too high for your taste, you have to remember that these businesses would go bankrupt if they weren’t making a chunk of money on each of their sold cars:
“As a salesperson, when someone throws a lowball number at us, or demands our best number, it is often taken as sign of aggression. My goal is to help you, the customer, find the right vehicle and get you a fair price. ‘Fair’ being the important word here. Ideally, I would like you to buy a car for list, and you would like to buy the car at cost. We need to find a middle ground, where both you and the dealership are comfortable. That’s not to say we don’t often sell cars at invoice or below, or that we will fight you over it. If you come prepared, have reasonable expectations (not ‘I want a $200 car payment on a $40,000 car’, or ‘I want $2,000 below invoice’), and don’t have a bad attitude (‘I want the evil dealership to lose money on me, because I’m super special!, or ‘you people all suck!’), then you can easily get a car for invoice or below. Wiki ‘Self Fulfilling Prophesies’. Advice: Price a few places online, have your trade with you, be honest about your expectations, give us tools to help you, and you CAN have an easy and pleasant (it is possible!) experience. Just one note: DO NOT submit an Internet lead to the dealership you plan to buy at. Bring other leads with you and use them upfront. They are often the best deals possible, or close to it. Do not use true car, unless you use a fake name and create an email account for it specifically. Dealers are charged by companies like TrueCar for each sale, and it’s no small sum, which means you just lost a few hundred potential dollars! Be firm, but be kind. I will bend over backwards for nice customers, because they make my job enjoyable, even if I’m making minimum wage selling them a car. I am more apt to help you when you have questions and help you after the sale if you are nice to me. The people on here who beat sales consultants up are losing out on the services we provide after the sale, because we avoid those people like the plague. Why would I want to help you if you beat me up (verbally) and made my day suck. We are people too. Not to say there aren’t some bad apples, but most of the guys I work with are awesome people (I’m a chick btw). They are respectful and will do whatever they can to help you get the car you want.
Oh, and one last thing: If you are following my advice and you feel uncomfortable or don’t like your salesperson, just tell them that you don’t want to buy the car from them and leave. Tell them why. The bad apples need to hear the truth. Who knows, maybe all of the other people who didn’t like him just didn’t tell him why. Maybe he needs a reality check… I appreciate honesty in my customers and reciprocate. Tell me why you’re not buying. Maybe I can fix a problem, or maybe I can learn from the experience…
<be nice to your salesperson, be willing to work with them, be prepared, and you can actually have fun buying a car, while also getting a great deal>”