To me, buy here pay here = chase your money, chase your cars. Tough racket for a start up. Like owning an apartment building in the low rent hood. I think your best advice was the commercial side. Buy em right and they'll almost sell themselves. A fully functioning reliable rusty 1 ton truck/van will still sell everyday somewhere. Just gotta keep your money right. Thanks for sharing
I knew a guy whose family ran one they had some high down payments and would repo the cars after 3 weeks of missed payments and they did okay until the local big employer shut down and all their cars drove 800km away and the towing on the repos would have eaten up any profit
In the late 80's I worked at a Buy Here Pay Here car dealership. Our business model was whatever we had in the car was what we charged for the down payment. It would take many paragraphs to divulge all the shady things we did. One thing I doubt most people are aware of, we didn't sell to Indians because we weren't allowed to go on the Reservation to repossess the cars.The worst thing about BHPH was seeing people that were already in a desperate situation (single Mom with several small children) being put into a worse situation.
I have seen it many times over the years with people I know. This lot in my hometown, was in the early 2000's. Advertised Guaranteed financing. all cars on the lot $180 /month $500 down. the lots were always full of Taurus, Escorts, Sables, and Topaz's. Basically cheap $1500 -$2500 cars. They required $500 down and $180 a month for 2 years which is $4300 paid for a $2000 car. Many of the cars had huge problems from the start, burning oil, nonfunctional AC after 2 weeks etc. They were 100% preying on the people that needed a car for work/school but had no cash or credit history.
dunno if anyone gives a shit but if you guys are bored like me atm you can stream pretty much all the new series on Instaflixxer. I've been binge watching with my brother recently xD
I started a trucking company with 1 truck that ran, 1 truck that kinda ran and 2 trailers. Kept rolling the profit back into the business and picking up customers and buying equipment to where I retired with 75 trucks and 160 trailers..
@@joeishere500 truth be told, I kinda got wrapped up in the "can't say no to customers" game. Ida been happy with just a few trucks crewed by some awesome drivers but 💩 happens
I think one of the biggest problems is all the different shows people watch where they see someone buy a car and then turn around and flip it for profit. It gives the false impression that it is extremely easy, and anyone can just dive in headfirst and become wealthy overnight. They didn’t watch all the struggles it took as well as experience and skill gained to reach that level of success. Start small, do research, and work your way up and then maybe, just maybe… you can become a tower of power too sweet to be sour!
I love rabbits vids too their is only one thang rabbit hasnt mentioned... being (buy here pay here) u also need to be your own mechanic...u pay some idiot to fix things it gets fucked up worse...most the time...sometimes Bein a salesman falls in ya lap..if u have the gift of gab...but to be a mechanic...it takes skill
@280zone Cops take your cash if they "believe" it was involved in a crime. You have to prove innocence in court under civil law. Courts have upheld its legality.
Excellent advise. The one thing I would add to that is, ..... if you want to get into the collector car business, for your first few transactions, but a car you would love to own. That way, if things don't go as planned, you end up with a car you always wanted anyway. That way if the world developes a Corona Virus Pandemic the day after you bought your "inventory", at least you love the car(s) you have in stock till they sell. Take care Bud
I started out in high school. Gotta roll the dice sometimes, sometimes u break even, sometimes u lose, sometimes u win BIG. Never know till you try!!!!!
You pay for what you do not know. It's great to have specialized knowledge that people will pay for. People forget the amount of time you have to dedicate to car sales - my former boss experienced this trying to sell his Honda Accord, as I helped him through it. Granted it was sold in a day or two. But all the cleanup, freshening up, pictures, dealing with keyboard mechanics ("has the timing belt been replaced" - it's a 2006 4 Cylinder Accord...it has a chain), etc. I could not do BHPH personally. Commercial and regular passenger vehicle retail I could. Classic/restored sales could be fun. I love flashing cash to people when buying cars and watching their eyes POP. Negotiations are much easier. Cash talks, BS walks right? Another great video Rob!
This was 12-13 years ago, I worked with a gypsy(yes he could trace his roots 150 years back to Romania). His family owned a "buy here, pay here" car lot in a poor black neighborhood. I think he got sideways for a bit with his old man, thus why he was working for me. He told me the trick of the trade was to sell the car to people who he knew were deadbeats and would default. They put GPS trackers in the cars and kept spare keys on anything they floated the note on. Told me people who put down $500 and were late 3 months later on their payment, they'd work with them, extend the deadline, try to get some more $$$$ out of them, etc. Somebody who signed a 12 or 24 month loan, missed that payment way late in the cycle, like missed their 10th or 22nd payment. They'd be driving by their house at 1 or 2 am, repossess that car an hour or two or three after they missed their payment. Said the secret was to resell that same car 3 or 4 times to make some real $$$$.
Rob, you're definitely someone I wish I knew personally. I can listen to guys like you talk all day long lol. Experience + great f-in stories = My kind of people
It's amazing how many fly by night car lots spring up about February every year and are gone 3 months later. They are usually loaded with cars priced under $8,000 but because they are high millage only worth about half of what they are asking. But they look nice have a 3rd row and that's all that matters to their target clientele. If a guy had 30 SUV's with 3rd row and 20 mini vans around 10 years old regardless of miles on them he could sell them for $6000 a piece and only have to work 3 months out of the year. Every single mom in town is looking for that 3rd row but doesn't want to spend all that income tax money and $6,000 is the sweet spot for her.
@@Borderline5440 casey challenged rabbit, imsa corvette vs stock car, rabbit wanted to have one of his driver's do it, casey wanted Rob to drive instead so it was a true matchup, but Casey is a professional driver while Rob is not, then casey threw a bitch fit. I love both content creators but honestly, it's mostly casey's fault
I work at one of the “large” BHP you mentioned... one thing that’s a big part of it now is that even “regular” dealerships have opened up their financing terms. Companies like Credit Acceptance will pretty much finance anything, to anybody. Heck, our local large CJDR dealership has a bankruptcy department specifically for people that have recently filed. It’s crazy.
I just love your brutal honesty. It's so refreshing to hear someone tell it like it is without some "politically whitewashed" fairy tale story. I just found you but I'm addicted.....
Always love you videos rob thanks for helping us young guys out with the knowledge that you have cuz so many people don't realize how many things you have to do as a salesman That's where I knew I wasn't able to do it and I just work his mechanic.thanks again rob always love your videos keep up the good work man
I worked at a local used car lot here in portland for four years. The cars they used for buy here pay here were usually bought for around 1000 or so dollars. Their rule was the down payment would have to cover the cost of auction bill and repairs, so the payments were pure profits. No payment? You're getting Repo'd.
An owner of a buy here pay here lot once said “remember you can always make more money off poor people than rich people “. It takes a lot of capital but 20% interest rates add up. And on trade ins just shop around I just got through buying a new truck and was offered from $10k-$15,500 for my trade.
In 1998 I lost my job and my wife was working part time as a waitress. We went from $6500 a month of combined income to about $2100. Luckily we had no car payments (A Nissan Maxima & Jeep Pickup owned outright). Our house payment was only $620 a month. I had to make money fast to keep us afloat for clothing two growing kids, food and utilities. I went to a car auction where I had seen a sign just to preview and watch bidding. All the cars needed some work and went for between $200 to $800 average. Some as low as $50 for non running and as high as $3000 for the one or two newer nicer cars. I made a list of cars that had a perceived value that were popular in Olympia WA with high resale and known as dependable running. Volvo, Nissan, Toyota, Subaru, Chevy Trucks and vans. Called and vusited the junk yards to see what models they had a lot of that were wreaked and not blown motor. I made a list of what parts cost at the pick n pull junk lot like fenders, doors, glass, interior parts etc... I made a list of things I knew I did not have tools or knowledge to fix and things I could fix. I made a qualifying sheet of paper that I could fill in the make, model, color, VIN of a car and then a checklist of options like AC, CD Changer, Power windows etc. And a section that was checklist of repairs needed, fix roll up window, replace dented fender, change fluids, replace torn seat ect... I would fill out these sheets for myself as buying notes when preveiwing the cars the day before auction and write a price I thought I could sale it for, what repairs would cost including parts from my list of pick n pull parts cost and what I would pay. If I could not make at lest $500 in under 20 days on the car I did not buy it. I used those sheets to guide my bidding, never bidding more than I had established as my max bid amount. Never ever buying with my high school eyes on the Z28, 300Z turbo, Bentley for $3k or whatever. Only models I could get used parts for, fix myself, and were popular in the area!!!! Then I went to the action purchasing two to four cars every two weeks buying those specific models I had targeted fixing only things I knew I could, cleaning and reselling them. I sold an average of 8 to 10 cars a month for over three years making $3500 to $5600 a month. I was investing 20 hours a month of auction time and 20 to 40 hours on the cars, 40 to 60 hours a month. That left me tons of time to take the kids to school, ride bikes, go camping, play with them, go to the zoo, teach them, feed them the best food and have there early years be better than mine were as a kid. Right now if you are unemployed making $600 a week or more with stimulus, have time, some tools, a little know how and need something try it.
The example you said in regards to people who say they will sell their car on their own is the reason I trade in my vehicle. As long as the difference is fair and including all taxes and fees don't give a fuck how much more I could get. Not worth the hassle of dealing with the public.
Appreciate the like from a fellow sales person in a completely different industry (equipment parts). Thankful I deal with owners and mechanics generally though @robbpitts
The trade in bit made me think of a conversation with a buddy of mine. We both do HVAC by trade and he was bustin my balls for not doing the work on my own trucks. Without even thinking off tax write offs. I explained to him that if I bring my truck in to get brakes done it’ll be done more than 2x faster than if I do it, they’ll have all the tools and the know how etc. I probably could do it but it would cause me a big ass headache. Just like my mechanic could probably put in his own furnace but it would be a hell of a lot easier if I did it for him. Moral of the story I think shit should be left to the professionals.
Well, Rob I only worked in car sales for 6 months at a Stealership, but found out I was just too honest for the job. I couldn't lie to people and do the old bait and switch. (oh yeah, the car your looking at is still here... oops, it got sold just before you got here... let's look at something else.) The worst one was when I made a first pencil deal on a referral customer for a 2016 Toyota Camry with 44,000 miles in good shape at $749 a month w/ $1000 down 72 month payment. (The young man had no trade-in and was a high 500's credit score) We had already done a test drive and the customer loved it. I go to the Sales Manager he's like... "You got a first pencil on that? Wrong car. Needs to be looked at in the shop." Mind you, this vehicle had been on our lot for over a week and I know it had been looked at and cleared by the shop. "Show him this one." So, he has me test drive my customer on a 2014 Toyota Camry with 87,500 miles in rough shape. (dents, in fender and door, rust on fender - that had come in two days earlier and hadn't been through the shop yet) The customer was not happy with it at all, but understood that it wasn't me, it was my Manager. To top it all off, though, my Manager had me go back to my desk with the offer at the same $749 a month w/ $1000 down 72 month, for a car 2 years older with twice as many miles and in the shape it was in! The customer was PISSED! And I don't blame him, I was pissed for him, and told him so and that I thought it was wrong. About a week later, they let me go, and their exact words to me where... "You're a great guy, a nice guy, a real people person, but you're just too honest for sales." Love your videos. You keep telling it like it is!
Buy Here Pay Here: You buy a $1K car at auction, and maybe put $100 into it. Suddenly, it's a $2995 or even $3995 car with a down payment of $999 or even $1499. It's actually a lot cheaper than buying better cars, and can generate a much healthier cash flow without a fllor plan and the resultant interest.
Lol Ford GX2. Yeah definitely rubber ball car. My brothers 1st car it only broke down ONE time. After 4 or 5yrs But it broke 100%. It broke down cause he NEVER changed the dam oil ever. Not 1 single time in 4 or 5yrs. Yeah motor blew. Who’d figure. He never even checked or added oil either. 🤦🏻♂️. Buy here pay here cars. Here in FL. 28% interest. Had 2 cars. Never again. Most of ours use actual lenders. Like Barnett finace in GA. But our Buy here dealers get wrecked up cars. Or old rental cars. And then sell them STUPID HIGH. It’s a bad deal all the way around here in Jax Fl. It’s your last ditch option
In the ghetto, "Buy Here, Pay Here" works like check cashing: You get fat down payments for a "cosmetically desirable" car and your buyers consistently default in under a year, allowing you to repossess the car and resell it, again, with a fat down payment. Lather, rinse, repeat. It's flipping the same car over-and-over, a few grand at a time, plus some payments. (It's also a great way to launder money.)
It's interesting that you mention JD Byrider. Some years back, they opened up a few places here in Massachusetts and had a big advertising campaign on local TV to promote their stores. In 2017, the state attorney general's office brought them up on charges of deceptive practices, predatory lending, and selling defective cars. In March of 2020, JD Byrider agreed to cancel a bunch of debts, and paid out 1.5 million in loan reductions and restitution to customers, as well as changing their lending practices. AFAIK, they are still in business, but I haven't seen any ads for them on TV in well over a year now.
We have a buy here pay here with 4 locations. Cheapest vehicle they had on the lot in early 2019 was a singer wheel k3500 with a 454, no fenders above the rear wheels, and 370,000 miles. Still wanted 4700.
Big Country you are 10.000% correct with commercial truck sales I worked with a Polish guy Paul at a body shop he was a combo man keep in mind he came to this country with nothing . To this very day He is a multi millionaire he has a huge com. Truck lot . I say good for him .
I wish you made this video 6 months ago, before we started buy here pay here, it’s a monster, we currently have 80 cars on the books, there is so many headache’s in this business. & so much loss, we have to have 150 units out & paying on time before we cash flow & pay for the cars going out
@@jordangribbins1348 ,, DAM thats alot of units..... try getting a credit line for reselling ... you'll climb back up there . I flipped in Chicago. Question , does 1 have to be in business 2 years before a Lender will sign with you ?? I herd this from a small dealer
@@joeishere500 we was able to get help throw west lake & a few other finance companies about 6 months in. “Was not a good fit for us although” if that’s your question, but as far as a credit line I do believe you have to be in business for 2+ year “have to have tax returns to show profitable” although. We are in a small town & the bank knows us & are itching to loan us money.
First time I watched this 4 months ago I remembered thinking about what that could be in the back of that Chevy pickup. Thanks to Matt the Camera Guy now I know it's an alternator box lol
There was a time in my life I had to use buy here pay here lots to get a car, now I buy and sell about 3-5 cars a year to make extra money, my wife and friends think I should work at a dealership. But they are feast or starve and I like a dependable check
Plus there are electric robotaxis to come, that'll eat into dealer revenue. Your business model lets you scale down easier as the business climate adjusts. RU-vid "tony seba robin hood conference " for more info.
The way to make money in buy-here, pay-here is be the bank that finances the lot. This rule applies to everything, but here it goes - "do you know who made money during the gold rush in California? Macy's, JC Penny, JP Morgan, Hearst... point is, it was the suppliers, the banks and the media who made the money. Finance the next Rabbit, learn from him, then take on his task... or just find another Rabbit (as if that's possible).
Back in the day, whatever the down payment was at a buy here pay here was what the dealer had in it. I used to help transport cars from an auction for a buy here pay here.
Brother you are pure entertainment. I'll tell you what I pay money cash money to watch you in the WWE! A cat like you with your charisma and character be a sensation out there. You don't have to be a wrestler you'll be the perfect manager with an entourage of ladies surrounded by you, haha. Yeah buddy!
@Rob Pitts. How ironic that there are eBay ads in some of ur ad breaks. If that’s not an all timer I dunno what is!! Literally lol’d when the first eBay as I saw come up. But hey, I guess u still get to make $$ off them in the long run!
Had a friend who loved dangerous repos,he had his "dirty harry .44 mag. "with him at all times. dragging cars down the street halfway hooked to the wrecker with some crazy fuck shooting at him etc.
4:44 wish I would’ve saw this 8 months ago 😂 I did the exact opposite and dove head first. just spent 7 months at a high pressure high volume Chevy dealer, sold a decent amount of cars for being a green pea but definitely shortened by life by a couple years from all the stress. wouldn’t change It though I’m at a lower volume gross dealer now and loving it.
Hey rob. Here in sc. Bhph is considered secured sales; not unsecured sales. I took the dealer class too... I have to renew soon. Spot on thanks for all the info.
As someone who used to be in car sales, the best buy here pay here formula you can have is to get the down payment to cover what you have into the car. That however is a rare case unless you are buying low cost shit boxes. Then you run into the issue of the car breaks and the payments stop.
I once was trying to buy a Mustang and trade in an 8 month old Honda CR-V. Dealer said they'd give me $17000 trade. I said I could get more for it myself. Salesman said they would let me do a dealer pass-through if I found a buyer and brought them with me when I bought my Mustang. Put the CR-V on Craigslist and had a buyer in a couple of days for $22K. Brought him with me to the dealer when I went to buy my Mustang and the dealer handled all the paperwork, dealt with my lien on my trade-in, and charged me $500 for all this. I got all the tax savings from a trade in and another $4500 for my trade. Probably not a lot of dealers willing to do that and there is certainly risk for the dealer if my old trade-in vehicle shits the bed and the buyer wants it fixed. They probably only were doing this if the trade-in vehicle was still under warranty.
So true about SALESMAN being a trade. Lots of people skills, researching, and knowing what to ask people to get them what they need/want. Working in Ag and lots of friends in equipment businesses, the right salesman can help get you into the right piece of equipment and the wrong salesman can easily sell you something that will not work well for your operation and could easily end up costing you more money.
Rabbit, you call sales a trade...I would disagree. I thinks it’s more of a profession. Keep in mind, I have great respect for plumbers and carpenters, and I can’t work with my hands worth a damn. If I’m ever in the market for a classic car, I would buy from you because, despite what haters may say, you are a true professional. That means a lot on a big investment like a classic car.
I’ve made good side money buying and selling daily driver trucks. Literally bought a truck at a good deal. Instantly put it up for sale. Drove it to work a few weeks and sell if for a couple K more than I have in it. Just have to find that good deal.
Just want to say, you can make money from Mecum, Schroeder Motors is a local classic car dealer that exclusively makes money through Mecum but I’m gonna say this. It’s been ran for 3 generations and it’s up and down. They’ve made crazy money on cars and they’ve also broke even or lost on cars. They’re established and know how to make money even when they lose money which isn’t easy to learn. He’s not wrong most of Mecum etc. is for personal collecting because it’s hard to make money there as a dealer.
my now long-gone uncle was a banker and liked to repeat two rules to us when we were kids: never loan money to a french restaurant, and never bank for a used car lot unless all they sell is high end Mercedes and Porsches.
