Capital for the LHPH Industry

Creating financial flexibility one dealer at a time

Lease Here Pay Here Success

Kevin Londerholm  |  June 18, 2020

The first question every dealer researching LHPH asks is, “can I make more money with LHPH?”  The answer to that question is yes.  There are numerous new profit opportunities that come with the implementation of a LHPH program.

With a Lease-Here Pay-Here deal, the dealer leases the vehicle to the first consumer and then services that lease through its term.  The LHPH dealer makes the same profit as a BHPH dealer from the original mark up on the car and earns a rent factor on each payment equivalent to a similar interest rate on the BHPH note.

However, when the lease matures, the dealer still retains the vehicle (the asset) and can re-lease the same vehicle again, or sell it, without purchasing new inventory.  When the vehicle is leased again, the dealer makes a profit on the markup a second time, as well as the rent factor on each payment (interest) from the new lease, creating a second stream of payments generated from the same asset.

Listen below to the high level of profitability that an Independent Auto Dealer can achieve through operating a LHPH Program:

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