war-faceIn the book of Ecclesiastes Solomon speaks of a time for war and a time for peace, a time for love and a time for hate. I have long hated the Buy Here Pay Here practice and enough is enough! Now it’s time for war. The Bible is very clear about taking advantage of the poor, the weak, the widow and the fatherless. Jesus hated it, (not the people doing it) but their sin. In Nehemiah five, Nehemiah found out the Nobles were collecting usury from their fellow Israelites he became enraged. 6 And I became very angry when I heard their outcry and these words. 7 After serious thought, I rebuked the nobles and rulers, and said to them, “Each of you is exacting usury from his brother.” So I called a great assembly against them.

This same practice is happening in our day at Buy Here Pay Here (BHPH) used car lots across the country sprinkled like strip clubs, taking advantage of the weak and the widow and the fatherless. Strong words you may say but I am ready for the fight.

The basic premise of these bottom feeders is to purchase extremely inexpensive cars that can be sold at a good profit to high risk bad credit customers. I have no problem with that. Then they extract a down payment hopefully enough to cover their costs of the car, taxes, license fees etc… As is discussed in this article by the “Special Finance Coach” BHPH It’s all about the CID (cash in the deal). Now they add finance charges as high as the law allows which in some states like New Jersey can be as much as 30% APR. In some cases they also add a loan acquisition fee where the laws allows that, or a doc fee where the law allows those. I worked for a chain that actually charged BHPH customers 28% APR then a $300 loan fee and a $189 doc fee.  Here is what a typical transaction would look like.

1997 Dodge Neon Dealer Cost $700 sale price  $1,995.00

total sale price plus tax and tags using NC rates $2,185.00

Buy Here Pay Here Customer is Charged

Down Payment            $900

Loan Fee                       $300

Doc Fee                          $189

Loan Interest 28%      $790

Amount Financed      $1,095

Total Price paid for the car (that cost the dealer $700)    $3,274   

Total profit = $2,574

A return on investment ROI of 267% or 133.7% annualized.. This is Plain and Simple usury not matter how you slice it. The part that really grinds me is the people they are abusing are the weak and the fatherless and the widow. The other major issue is that many times when the high risk customers pay their cars off they don’t even report to the credit bureau to help them get their credit back so they can keep them down.

I can hear them screaming now; “these people would have no other chance to get a car without me. I have huge risks I deserve a huge reward.”

In my book you can line them up with the lotteries who pray on the weak, along with the strip clubs who pray on the weak and the loan sharks. There is a lot of money to be made in taking advantage of the weak but as Fanny and Freddie and many other high risk lenders have seen, God is watching and Christians need to speak up especially to the Christian brothers doing it and I know several.