Lease Here Pay Here

Leasing instead of Regular Finance presents valuable advantages to the BHPH Industry

Better Cash Flow
Most States allow you to collect Use Tax on the monthly payment instead of Sales Tax on the price of the car, a Buy Here Pay Here requires large Down Payments which are lost in case of Default if Sales Tax was paid up front. Leasing provides an alternative where any down payment can be applied towards the vehicle and Use Tax is only collected if and when payments are received.

Fees & Security Deposits
Additional monies can be collected in a Lease ad Acquisition Fees and Security Deposits, enhancing the Lessor's cash flow.

Better Profitability
The direct effect of having a lower payment increases the profit as compared to a finance transaction, the process of negotiating the lease itself makes it profitable and acquisition, and termination fees are all profit, You are still able to set a price at a considerable markup as well.

Since you are the owner of the vehicle, repossessions are easier
You can pick up your vehicle in a Bankruptcy
You get your car back at the end and your customer too.

Federal Regulations are simpler for leases (Regulation M instead of Regulation Z)
State specific regulations are simpler
Consumer Disclosures are reduced in comparison to a sale.

Keep your customers
The Lease is a relationship the customer will have to come back to you at the end or in the case of early termination.
The shorter term means you can see your customer more often.

Frequently Asked Questions...

Is it more complicated to do a lease than it is to sell a car?
No Leasing is actually simpler, all you need is a Lease Agreement, the calculations are all preformed by the LeaseMaster, you enter the Cap Cost instead of the Price and a Residual which is the value at the end.

Do I have to use Money Factors instead of APR rates?
No, You can use APR is you prefer, the program makes it easy for you to compare your interest income to what it would have been on a purchase.

Don't I have to collect the same amount in interest and principal each month?
No you can collect the same way you do on a purchase, interest first principal later, in Leasing they are called rent and depreciation but they are collected the same way by rule of 78 or simple interest.

Will I have to keep my Leases separate from my Sales in my portfolio?
No, both types can be listed in the same portfolio, they can all report to the same credit bureaus and managed and collected the same way loans are managed and collected.

Isn't it more difficult to calculate my profit, how do I know what to bring the car in for at the end?
You can use very safe calculations for the residual (value at the end) and put mileage and wear and tear specifics to make sure you get a car that is worth at least what it was supposed to. Used cars don't depreciate as much as new cars do so you can use a percentage of what a car is expected to be valued at at the end of the lease.

Download our Free Demo, install it and call 800 701-6686 so we can show you the different scenarios and compare Leases and Loans

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