Written by Info Expert on July 7, 2010 | Posted in Automotive

There are not a lot of people today who can walk into a car dealership and plunk down the price of a car in cash. It is pretty much a guarantee that you will have to get a loan to buy you car and this leaves you a lot of choices. A car finance loan can be obtained from a number of sources and which way you decide to go can make a huge financial difference.

We all know that the salesman gets a commission on every car they sell but most people do not know that the finance person at the car dealership also gets a commission. This is why they always try to push extra features. It is in the finance person’s best interest to get the final price of the vehicle as high as possible. When you are applying for a car finance loan from the dealership the finance person will no doubt try to sell you extended warranties’, undercoating and even fancy alarm systems that no one pays attention to when they go off.

There are plenty of options, other than dealer financing, to get a approved for a car finance loan. There are a number of companies that specialize in smaller loans and it is much easier to get a loan from the than from a bank, which is probably now hamstrung by government regulations. Finance companies usually charge a few points more interest than either a dealership or a bank but the terms are usually easier and it is much easier to qualify for than a bank loan.

The bottom line is that with each choice you will have both pros and cons. The lowest rates will be found at dealerships but you will have to deal with the sales pressure of salesmen trying to make a commission. Finance companies are a good choice also and while they have higher interest rates than a dealership will charge they are still lower than a bank and are much easier to qualify for.

Popularity: 1% [?]