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Car Financing - How it Really Works Kapolei 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.

Citifinancial
(808) 689-8885
91-1001 Kaimalie St
Ewa Beach, HI
 
Honolulu Federal Credit Union
(808) 687-8565
1001 Kamokila Blvd Ste 104
Kapolei, HI
 
West Oahu Community Federal Credit Union
(808) 682-4511
Shangrila St Bldg 1867
Kapolei, HI
 
Waipahu Town Center
(808) 677-0606
94-366 Pupupani St
Waipahu, HI
 
Hawaii Check Cashing
(808) 456-8011
897 Kamehameha Hwy Ste 101
Pearl City, HI
 
Kahi Mohala Behavioral Healthcare
(808) 677-7600
91-2301 Fort Weaver Rd
Ewa Beach, HI
 
Budget Pros Inc
(808) 674-8767
91-1004 Kanihaalilo St
Kapolei, HI
 
Hickam Federal Credit Union
(808) 423-1391
590 Farrington Hwy Unit 501
Kapolei, HI
 
American General Finance
(808) 671-5664
94-1040 Waipio Uka St Ste 7
Waipahu, HI
 
Cash In Advance
(808) 454-8700
880 Kamehameha Hwy Ste 2
Pearl City, 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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