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Car Financing - How it Really Works Lombard IL

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.

Interim Funding (Funding Insurance)
(888) 495-7300
1 South 270 Summit Ave
Oak Brook Terrace, IL
 
Express Auto Finance, LLC
(847) 752-0195
8170 N. McCormick Blvd Suite 118
Skokie, IL
 
The Auto Warehouse
(773) 245-0421
2622 North Cicero Avenue
Chicago, IL
 
caliseum II.inc
(773) 580-5771
3104 w walton
chicago, IL
 
Honor Finance
(847) 733-0300
1563 Sherman Ave.
Evanston, IL
 
Nationwide Acceptance
(800) 622-7605
3435 N. Cicero Avenue
Chicago, IL
 
Turner Acceptance
(773) 539-8900
4410 N Ravenswood
Chicago, IL
 
CHOP YOUR CAR PAYMENT, INC.
(312) 895-5400
8926 N. Greenwood Avenue
Niles, IL
 
Turner Acceptance
(773) 539-8900
4410 N Ravenswood
Chicago, IL
 
Nationwide Acceptance
(800) 622-7605
3435 N. Cicero Avenue
Chicago, IL
 

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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