Unless you're paying cash for your new car, you'll need to finance the purchase. The two primary ways to get a loan for your car are through the dealer or through outside financing, such as a bank. Today we're going to discuss some of the details when financing through the dealer.
What is Dealer Financing?
Instead of going directly to a bank, credit union or other lender, the dealer collects your information and forwards it one or more auto lenders. If the loan comes back approved, the dealer will present to you a financing offer. Many times, dealer financing is also bank financing, but the dealer is doing the leg work.
Benefits of Dealer Financing
The biggest benefit of gong with a direct loan from the dealer is that it's easier. Instead of having to shop your profile around to various banks, the dealer can do that work for you. In one visit, you can show up, get a loan and drive off (into the sunset).
Another nice perk of dealer financing is that the dealer can offer low rate promotions banks can't touch. These kinds of promos are common with new cars, but they can happen for used cars, too.
The last benefit we'll mention is that dealers are open to rate negotiation. Unlike dealers, banks usually give you their best rate with their offer.
We hope this peek into getting financing straight from the dealer is helpful. If you have any questions, please leave a comment or contact us here. We're here to help.