When the time comes to shop for a new vehicle it’s natural to have some questions and concerns about financing. While it would be nice if you had the financial means to purchase your vehicle with cash, that’s not an option for most people.
One of the biggest mistakes you can make is assuming that the dealer’s finance department is the only one that can secure you a car loan.
It’s okay to lean on your dealer for assistance, but you don’t want to put all your trust in them. Here’s why:
- The dealer will do whatever they can do sell you a car, even if it’s not in your best interest
- The dealer has relationships with a specific network of lenders
- The dealer has the power to increase your interest rate — over what the bank offers — as a means of making more money on the deal
Now do you see why the dealer shouldn’t be the only place you search for a car loan?
Your Other Option
Although it takes more time and effort, your other option is to search for a car loan on your own. There are many ways of doing this, but the only thing that matters is that you end up with the information you need to make an informed and confident decision.
Here are some tips for securing a car loan on your own:
- Start with a lender you trust: For example, if you have a banking relationship with a local bank, contact them to discuss your car loan needs. This is one of the best ways to start the process as you already have a relationship build on trust.
- Go online: The most efficient way to find and apply for a car loan is online. Additionally, this allows you to compare all your options side by side, thus making it easier to make a final decision.
- Know what you want: There’s no dealer to talk you into something that doesn’t suit you. You’re 100 percent in charge of the process, so knowing what you want is important to getting it. For example, think long and hard about the term that best suits you and your budget.
Maybe your dealer ends up securing you the best terms and conditions on a car loan. But perhaps you’re able to do better on your own. That’s why it’s so important to keep your options open.
Buying a car is a big deal as it has the potential to alter your budget in a number of ways.
Put yourself on the path to financial success by securing a car loan from a reputable lender.