Why is Lease-Here-Pay-Here worth a look?
One of our strategic partners, LHPH Capital, lists some very good reasons as to why Lease Here Pay Here is a viable option.
- "To differentiate themselves. Competing for volume in the BHPH segment often leads to lowering rates, more aggressive buying, higher advances, and abusing program guidelines in general. With leasing, the dealer can make their program better for the customer and not provide an Apples-to-Apples comparison for the competition."
- "Better options when a deal goes bad. There are more favorable rules for repossessions and bankruptcy – get the car back and on the road quicker."
- "No sales tax due up front in 32 states, which leads to lower advances and hence, lower losses with much improved cash flow."
- "Easier to sell and retain the customer. The dealer can provide a nicer car at the same payment, and the customer has to come back at the end of term."
After looking at the benefits, one has to wonder why isn't this the norm? Like most industries, we tend to resist anything new. However, as rapidly as the market is changing, I believe the ones that have the vision to look at alternative ways of doing business will thrive. The price of new cars continues to rise. Obviously, the used car market is following suit. In order to have a car pay off in a reasonable amount of time, the payments have to keep increasing. Lease Here Pay Here might just be the ticket for your customer to drive a newer car with a more reasonable payment. That is a very attractive competitive edge and a good way for continued business with your current and future customers.