Financing a Car Loan Through a Dealership
Financing a Car Loan Through a Dealership
Posted on February 27, 2023
When it comes to financing your next car, there are mainly 2 different routes you could take. financing through a dealership, or financing through your bank. So, how could you know which route to take?
Everyone’s situation is different. There are certain times where you would choose one over the other, this article will discuss what is involved in financing through a bank.
Financing Your Car Loan Through a Dealership
One of the main differences between financing your auto loan through a bank and a dealership is that with a dealership, you usually tend to decide on the car you want to purchase, THEN you apply through the dealership.
The dealer will then send your application to either their own finance team or an external source (such as a bank!). Dealerships such as ours also have quick ways for customers to apply for a quick pre approval before coming into the store.
The downside with going through the process of a dealership is that you will likely have to wait for a couple of weeks to get an official approval. To go along with this, if your application is denied, you will have wasted your time.
On the upside however, Financing through a dealership will often provide the customer with a great deal. This is because the dealership will be far more enthusiastic about you buying one of their cars. As opposed to a bank (such as 0% financing or a manufacturer’s cash back rebate).
Similarities
Another thing to consider with a dealership is that it is quite similar to a bank. The difference is that they are essentially doing the work for you to find you the best deal. This can be great because they could find just that.
On the other hand, it takes away finance options that may otherwise be available if you were to use a bank. Plus, the dealer may try to negotiate a higher interest rate as compensation for them handling the financing.
Still, those interest rates may still be lower than a bank which is why research is extremely important. As a car dealership chain, you would expect us to say we are the best option but we want to deliver exceptional service, and will always be honest about your options. Even if it means we lose a little business!
Credit Score
When it comes to poor credit score, dealerships are typically are much less apprehensive. This is not to say that a bad credit score makes it impossible to get a car loan from a bank, but in comparison the loan you get from a dealership will generally be preferable. (a credit union may also be a good option for you).
If you're ready for a car loan through a dealership, we'd love to help with that! simply fill in the form below to get started.