The Buy Here Pay Here industry has provided community-based auto financing for over 80 years. Many family-owned dealerships today can trace their origins back three or four generations to the 1920s, 1930s and 1940s. Whether financing cars for returning GIs or simply “holding the note” on transactions that banks and traditional finance companies would not. These business people provided transportation options by financing automobiles when other lenders did not understand these customers.
Buy Here Pay Here exists across the United States of America. Some have estimated that this industry is comprised of nearly 10,000 dealers that sell and finance between 3 and 4 million automobiles each year or approximately 10 to 15 percent of all used vehicle sales. This may represent $40 billion per year in sales that may generate over $2 billion in sales tax revenue. Any given time there may be nearly $100 billion in outstanding automobile contracts from small Buy Here Pay Here dealers to their local or community customers.
These small businesses employ over 300,000 people that sell, service and take care of these consumers. All of this is done with dealers using their money to provide financing for their customers. This is truly “Main Street” not “Wall Street” based financing. Virtually none of the capital in this industry comes from Wall Street – owner-operators risk their own capital and resources, unlike banks and traditional auto finance companies which obtain their money from Wall Street or through or through selling their debt to the public.
Often lost in the discussion is as more and more consumers are credit-challenged. While many traditional lenders have tried to provide to these customers the only consistent option has been the community based owner operators in the Buy Here Pay Here industry. They have provided a stable and dependable alternative for auto financing for millions of credit-challenged customers.