Choosing an Auto Loan with a Dealership
What to Know When Choosing an Auto Loan with a Dealership
Buying a car in today's economy is a significant undertaking that requires commitment. However, a bad credit score and low budget can be major hindrances that stop most people from approaching dealerships for financing.
Auto loans allow interested car owners to borrow from lenders to purchase vehicles. However, there are several conditions that borrowers must meet before getting their auto loan applications approved. 1st Choice Motors offers customers from Madison Heights, Monroe, and Amhurst affordable financing options and budget-friendly payment solutions to allow them to own their preferred cars.
Auto Loans With a Car Dealership
Many auto dealerships make significant money from auto financing, with most acting as intermediaries to connect clients with banks and credit unions. Interested car buyers with high credit scores have a higher chance of qualifying for lower-interest loans, saving them money in the long run.
Our trustworthy financial professionals at 1st Choice Motors work with customers to walk them through our in-house financing solutions and potential discounts for getting financing with us.
1st Choice Motors Offers Dealer-Arranged Financing
Buying a new or used car involves several moving parts, especially when an auto loan is involved. Therefore, working with a dealership that offers different financing options and has your best interests in mind is important.
1st Choice Motors offers auto loans to car buyers, including bad credit auto loans, at favorable terms. We work with car shoppers to secure the best financial rates that suit their budgets, regardless of their credit scores. Contact our finance center at our Madison Heights, VA dealership to understand potential car loan options and other financing offers.
How Auto Loans Work
An auto loan helps make buying a car more affordable by breaking up the vehicle's cost into monthly payments over a determined period. These loans typically range from a few thousand dollars to $40,000 or more. They also come with monthly repayments that range between 24 and 84 months, depending on the auto loan terms.
How much borrowers receive often depends on their financial situation and the vehicle they want to purchase. The payments made on the auto loan go toward the borrower's principal loan amount and interest charged by the lender.
Advantages of Dealer-Arranged Financing
It's always appealing to finance a car right at the dealership. Customers can find their dream cars, arrange for payments, and drive their vehicles off the lot in just a few hours.
Some of the main benefits of dealer-arranged financing include the following:
Convenience
Convenience is a key benefit of dealership financing, as the dealership does most of the legwork. The dealership submits the borrower's information to various lending institutions to find the best deal. Customers get to go through all the steps of the purchasing process in one place, including test driving the vehicle, the trade evaluation (if applicable), the loan approval, and paperwork completion.
Longer Terms and Lower Monthly Payments
Most dealerships offer personalized financing solutions that borrowers may not receive when using banking institutions or other lenders. Interested car buyers can get up to 72 months on their loan terms, which allows them to negotiate lower payments that fit their budgets.
Incentives for New Vehicles
Financing a new car purchase with a dealership allows borrowers many incentives, including customer loyalty cash, low APR rates, and even cash for competitive models (if applicable). Buyers also enjoy rebates and discounts that can change each month.
Disadvantages of Financing Through a Dealer
On the same note, there are a few factors that may make financing through a dealership not the best option. They include the following:
Higher Interest Rates
Some dealers mark up rates the associated financial institutions offer to turn a profit. This means borrowers may pay higher interest rates than they would by financing their purchase directly through the bank.
Longer Loan Terms
As much as having longer loan terms can ease the financial burden and lower monthly payments for the loan, borrowers may end up paying thousands more in interest.
Only Good for Vehicles on the Lot
It's important to note that dealer financing doesn't cover other dealerships. If an interested buyer can't find the car they want on the dealer's lot, they'll need to try another dealer and hope they qualify for financing there.
1st Choice Motors Will Work With You for the Best Deal
At 1st Choice Motors, we believe that vehicle financing shouldn't be something car buyers dread, but a simple and straightforward process. We offer our customers several financing options based on their financial situation to get them the best deal and avoid straining their budgets.
Don't hesitate to contact our financial team to learn more about our car buying and auto loan process. We'll be happy to help.
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