Auto Leasing Guide
Go to now !

Car Financing - How it Really Works Aberdeen SD

Car financing is frequently misunderstood by automotive consumers. Learn how dealer financing works, how to get approved, when to get a co-signer, and the importance of good credit.

Sioux Falls, SD
Action Auto Sales
(605) 216-4395
1123 6th Ave SW
Aberdeen, SD
(605) 225-9133
522 Moccasin Dr
Aberdeen, SD
Dollar Loan Center
(605) 225-5626
119 6th Curv
Aberdeen, SD
Wells Fargo Financial
(605) 229-3753
204 S 1st St
Aberdeen, SD
Action Bail Bond
(605) 216-4395
Aberdeen, SD
Action Bail Bond
(605) 228-9844
Aberdeen, SD
Surety Finance
(605) 229-2300
1714 6th Ave SE
Aberdeen, SD
Money Lenders
(605) 225-8666
124 6th Ave NW
Aberdeen, SD
Check 'n Go
(605) 229-2274
524 Moccasin Dr
Aberdeen, SD

Car Financing - How it Really Works

One of the most misunderstood concepts about buying or leasing a new car is how car financing really works. Dealer financing, specifically, is misunderstood.

We'll say it again later, but the key concept to understand is that car dealers do not finance car loans and leases. However, dealers can most certainly affect how you finance and what you pay for financing.

Dealers always sell for cash
Car dealers are independent business people who have an authorized franchise with one or more car manufacturers. They do not work for the manufacturer; the manufacturer does not own the dealership.

Dealers buy cars from the manufacturer, usually with large "floor-plan" loans from a bank or finance company. The bank charges dealers interest on these loans. Dealers have to sell cars to pay off these loans with associated interest, as well as cover other expenses of running a business.

When a dealer sells or leases a car, he always receives cash, whether it's directly from the customer, or from a finance company or bank who has loaned a customer the money.

A common misconception is that dealers would rather get cash directly from a customer, bypassing the financing step. Some people mistakenly believe that dealers give cash customers a discount. This is not true. In fact, dealers typically get a commission or "finders fee" on car financing provided by banks or finance companies and therefore prefer that customers finance or lease...

Click here to read the rest of this article from Lease Guide