What Happens if You Miss a Car Payment With a BHPH Dealership?

What Happens if You Miss a Car Payment With a BHPH Dealership?featured image

Posted on May 11, 2023 by Rick Griffith

Buy here pay here (BHPH) dealerships offer an alternative to traditional auto loan financing. They fund car loans to customers with bad credit or no credit history, allowing them to buy a car and make payments directly to the dealership.

Typically, customers can expect a lower down payment with higher interest rates than traditional lending. However, interest rates can vary from one BHPH dealership to another.

But when you miss a car payment with a BHPH dealership, you risk having the car repossessed. However, if you communicate a missed car payment before it happens, you may discover that these dealerships are more lenient.

In addition, BHPH dealerships are known for offering flexible payment terms compared to traditional auto lenders, such as giving customers the time to catch up on payments on a repossessed car. Either way, knowing what steps to take before you default on your car loan is essential.

Your best option is to call the dealership directly before you miss a car payment. The goal of BHPH dealerships is to help you succeed, so by calling them early on, they can work with you to adjust your payment schedule before you miss the car payment.

Know Your Options After Missing a Car Payment to a BHPH Dealership

To have missed or made a late car payment with a BHPH dealership, a bank, or a third-party lender is a stressful experience, so it’s essential to understand your options to take proactive steps quickly.

Depending on your loan agreement with the dealership, you can discuss an alternative payment plan to get your payments caught up or avoid repossession of your vehicle. That’s why it’s critical to contact the dealership immediately to discuss the options available before you miss a car payment.

Re-Establishing Creditworthiness After Missed Payment

Buying a car is one of the most significant purchases you’ll make in your lifetime. So, making regular, on-time payments that get reported to a credit bureau is the fastest road to financial recovery.

There are several ways to rebuild your credit to restore your trustworthiness with lenders. For one, the fastest way to rebuild your credit is to make regular onto time payments on a financed car from a BHPH dealership that reports to one or more credit bureaus. Most financed cars from BHPH dealerships get designated as significant purchase items with a loan term of 36 to 48 months, which works out to 3 to 4 years. 

Just be sure to ask the BHPH dealership which credit bureau(s) they report to and confirm the reporting is part of the contractual agreement on the financed purchase.

Secondly, stay on top of your finances by balancing your checkbook once daily to help you control your finances and avoid missing a car payment. Thirdly, call the BHPH dealership immediately if you believe you cannot make a car payment as agreed.

It will be far more accessible for the dealership to work with you before you miss a car payment. Otherwise, missing a payment to the dealership can and will have a significant setback regarding your creditworthiness and reflect a repossession on your credit history.

By having open communication with the dealership, you can work together to come up with the right strategies and guidance to get you back on the financial track and start rebuilding your credit.

Determining the Best Corrective Action for Your Situation After Missing a Payment

Missing a payment can have serious consequences, so knowing the best course of action for your situation is essential. Depending on the number of late or missed car payments, you may face penalties such as:

  • Late fees
  • Increased interest rates
  • Vehicle repossession

It is essential to understand the terms and conditions of your loan agreement, which is why it’s so important to have an open, ongoing line of communication to ensure you make all payments. The potential consequences of missing a car payment can have real impacts on your daily life, like:

  • Getting to and from work
  • Going grocery shopping
  • Making it on time to appointments

Never fear calling a dealership directly. If a dealership is unaware of your financial setbacks, they can’t help you. It’s integral to your financial relationship with the dealership to have open, honest discussions before you miss a car payment.

Car Credit, Working to Get You Back on Financial Track

The Car Credit team understands that no one should feel shamed by financial challenges. But unfortunately, these past few years have hit many Americans’ finances hard, and there’s no team working harder to safeguard your privacy regarding your finances.

That is also true of every car they sell. They have a rigorous reconditioning program for every vehicle because you and your family’s safety is of great importance to the team at Car Credit. A car must pass Car Credit’s quality standards of safety and reliability to be put up for sale to the public. Instead, those vehicles are sold wholesale.

That’s the kind of service you should expect from any dealership. To get started, look through Car Credit’s current inventory of cars and SUVs, then complete their online credit application! After all, you and your family are worth it to the team at Car Credit.

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