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Car Financing - How it Really Works Honolulu HI

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.

Wells Fargo Financial
(808) 487-3896
99-115 Aiea Heights Dr Ste 301
Aiea, HI
 
American General Financial Services Of Hawaii Inc
(808) 236-0007
46-028 Kawa St Ste A9
Kaneohe, HI
 
Pay Day Hawaii
(808) 247-7171
46-056 Kamehameha Hwy
Kaneohe, HI
 
Check To Go
(808) 235-6560
45-1055 Kamehameha Hwy
Kaneohe, HI
 
Citifinancial
(808) 235-0006
45-1117 Kamehameha Hwy Ste 103
Kaneohe, HI
 
Liberty Tax Service Omni Financial
(808) 486-0442
99-115 Aiea Heights Dr Ste 101
Aiea, HI
 
CitiFinancial
(808) 486-7600
98-199 Kamehameha Hwy Ste A1
Aiea, HI
 
C S D Financial Services
(808) 488-3918
98-025 Hekaha St Ste 4
Aiea, HI
 
Cash Advantedge
(808) 235-0014
45-480 Kaneohe Bay Dr
Kaneohe, HI
 
Allied Home Mortgage Capital
(808) 230-8691
167 Hamakua Dr
Kailua, HI
 

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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