The Federal Reserve doesn't study industries without a reason — and in May 2026, they published a deep-dive report on the Buy Here Pay Here sector that every independent dealer needs to read. Five Fed economists spent months analyzing real loan data, bank records, and portfolio performance metrics to answer one question: what exactly is the BHPH business model, and what risks does it carry for the broader financial system?

What they found will surprise you ... in both directions.

Yes, the scrutiny is real. The Tricolor collapse put Washington on notice, and the banking community is now looking at every BHPH operator differently because of one bad actor. Capital is being repriced. Risk ratings are shifting. The regulatory environment is changing in ways that aren't always visible from the lot.

But the Fed's data also tells a story the industry rarely gets credit for. BHPH loan balances have grown 214% since 2018. Dealers have been quietly moving toward less risky borrower segments for years. And the integrated dealer-financier model — done right — is one of the most effective tools in the market for serving customers traditional lenders won't touch.

Today, Jim and Michelle Rhoads breaks down the full Fed report through the White Hat Way lens: what it means for your capital access, your collections strategy, your customer relationships, and your long-term viability as an operator. If you want to understand the environment you're actually operating in right now, this is the episode.

🔗 Full Fed Report: https://www.federalreserve.gov/econres/notes/feds-notes/subprime-auto-lending-trends-in-buy-here-pay-here-auto-lending-20260508.html

BHPH Morning Show | White Hat Way | whitehatway.com

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Find the BHPH Morning Show LIVE on YouTube, LinkedIn and Facebook every Mon, Wed, & Fri at 11am eastern where we (Jim and Michelle Rhoads along with featured guests) talk #buyherepayhere #bhph #subprime #automotive #finance #ethics #whitehatway #customerretention #customerengagement #marketing and much more!

We are pleased to use our sometimes-scratchy morning voices to speak up on behalf of BHPH Dealers. Don't forget to LIKE the videos and SUBSCRIBE to The Octane Group channel. Also, please add your comments or questions right here in the BHPH Institute.