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Car Financing - How it Really Works Clearfield UT

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.

Prestige Financial
(800) 984-6737
1420 South 500 West
Salt Lake City, UT
Money 4 You
(801) 779-9792
1266 Legend Hills Dr
Clearfield, UT
Money 4 You
(801) 773-0909
2441 N Main St
Clearfield, UT
First National Bank
(801) 728-3013
1601 N Hill Field Rd
Clearfield, UT
Blue Tree Lending
(801) 776-6865
555 N Main St
Clearfield, UT
(801) 773-8181
1868 N 1200 W
Clearfield, UT
Sable Financial
(801) 776-1400
Clearfield, UT
Cash Advance
(801) 627-4242
Clearfield, UT
Security Finance Corporation
(801) 525-9660
1580 S State St Ste 6A
Clearfield, UT
USA Cash Services
(801) 825-9504
225 N Main St
Clearfield, UT

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...

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