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Car Financing - How it Really Works Grand Island NE

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.

AutoLoansInNebraska.com
(402) 318-7244
Lincoln, NE
 
Wells Fargo Financial
(308) 382-4310
2319 N Webb Rd
Grand Island, NE
 
Equitable Mortgage
(308) 382-1087
2838 Old Fair Rd
Grand Island, NE
 
Homestead Mortgage Inc
(308) 398-1813
3008 W Stolley Park Rd Ste 4
Grand Island, NE
 
Grand Island Investment Co
(308) 384-0957
202 W 3rd St
Grand Island, NE
 
Mid-City Auto Loans
(402) 341-5466
515 S 15th St
Omaha, NE
 
Tierone Bank
(308) 384-4433
1811 W 2nd St
Grand Island, NE
 
Ace Cash Advance
(308) 382-9054
3537 W 13th St Ste 104
Grand Island, NE
 
Ace Americas Cash Express
(308) 382-9054
3537 W 13th St Ste 104
Grand Island, NE
 
Home Federal Bank
(308) 382-4000
3419 State St
Grand Island, NE
 

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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