Choosing how to finance a vehicle is nearly as important as choosing the vehicle itself. Whether you’re looking for your first car, upgrading your daily driver, or buying a work vehicle, there are two common paths buyers consider: Buy Here Pay Here (BHPH) and traditional bank or credit-union financing.
Both options have advantages and important differences. The best fit depends on your credit situation, comfort level, and how quickly you need a vehicle. Below, we break down each option so you can make an informed decision.
What Is Buy Here Pay Here?
Buy Here Pay Here dealerships offer in-house financing, meaning the dealership sells the vehicle AND handles the loan. You don’t have to apply through a bank, third-party lender, or outside financial institution.
Ideal for:
Buyers with no credit
Buyers with low credit scores
Buyers rebuilding after financial setbacks
Buyers who need a vehicle quickly and want a simpler approval process
Why People Choose BHPH:
Faster approvals — often same-day or next-day
Easier qualification for credit-challenged buyers
Flexible down-payments
Relationship-based instead of algorithm-based
Payments may be made directly to the dealership, not a bank
Unlike traditional financing, approval is based on more than a credit score. Things like employment, income stability, and ability to pay are often more important than past credit history.
What Is Traditional Financing?
Traditional auto financing is what most people see at franchise dealerships or national banks. You apply through a bank, credit union, or third-party lender, and the lender—not the dealership - decides whether to approve you.
Ideal for:
Buyers with strong credit looking for lower interest rates
Buyers who have long credit histories or established financial stability
Buyers who prefer working directly with financial institutions
Why People Choose Traditional Financing:
Lower interest rates, especially with good credit
More lender options
Longer loan terms may be available
Interest rate shopping can help secure better terms
Traditional financing is often a good fit for buyers with prime or near-prime credit scores who want the lowest overall borrowing cost.
Comparing Key Differences
Approval Process
BHPH: fast, streamlined, credit-flexible
Traditional: slower, paperwork-heavy, credit-score driven
Who Makes the Loan Decision
Ideal Buyer
BHPH: buyers rebuilding credit, new residents, first-time buyers, or those needing quick approval
Traditional: established credit, higher income, rate-focused buyers
Payment Experience
BHPH: payments go directly to the dealership, sometimes weekly, bi-weekly, or monthly — flexible depending on income schedule
Traditional: payments go to an outside lender, usually monthly
When Buy Here Pay Here Makes the Most Sense
Buy Here Pay Here can be the right solution when:
You’ve had difficulty getting approved elsewhere
You’re rebuilding after divorce, job loss, medical debt, or credit challenges
You need reliable transportation right away
You want more flexibility around approval and payment scheduling
Your primary goal is getting into a safe, dependable vehicle without waiting
With the right dealership, Buy Here Pay Here can also help you rebuild credit over time, especially if the dealer reports timely payments.
When Traditional Financing Is Your Best Fit
Traditional financing may be better when:
You have good or excellent credit
You’re focused on the lowest possible interest rate
You have a strong financial history or long credit lines
You have time to shop lenders, compare rates, and complete paperwork
If your priority is overall cost of borrowing, traditional financing may be the best fit - assuming you qualify.
Bottom Line - There’s No One-Size-Fits-All
The best financing option depends on:
your credit history,
how quickly you need a vehicle,
your comfort level with lending requirements,
and how flexible you want the approval and payment process to be.
Buy Here Pay Here = simplicity, flexibility, and faster approvals for buyers who want a more human approach.
Traditional Financing = lower rates and longer loan terms for buyers with stronger credit or longer financial history.
Both paths can put you behind the wheel - the right choice is the one that supports your goals, timeline, and financial comfort. And at the Car Store, we are here to help you no matter what your situation or goals are! Give us a call, stop by our showroom or visit our website to check out our online inventory and get your pre-approval in minutes!
