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Car Financing - How it Really Works Missoula MT

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.

AutoLoansInMontana.Com
Helena, MT
 
Montana First Credit Union
(406) 728-1790
2330 S Reserve St
Missoula, MT
 
Score Service of Retired Executives
(406) 327-8806
110 S Broadway Ste Ste
Missoula, MT
 
United States Government
(406) 327-8806
110 S Broadway
Missoula, MT
 
Check 'n Go #2840
(406) 549-8263
400 W Broadway St
Missoula, MT
 
Mile High Chrysler Jeep Dodge Kia
(406) 282-3082
3883 Harrison Avenue,
Butte, MT
 
Rocky Mountain Commercial Capital Inc
(406) 251-5861
101 Alliance Way
Missoula, MT
 
Mountain West Bank
(406) 542-6222
1821 South Ave W
Missoula, MT
 
Creative Finance & Investments
(406) 721-1444
619 SW Higgins Ave Ste O
Missoula, MT
 
Capital Family Mortgage
(406) 549-1940
2307 Stephens Ave
Missoula, MT
 

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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