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Car Financing - How it Really Works Powhatan VA

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.

Coastal Credit
(800) 969-2729
3852 Virginia Beach Blvd.
Virginia Beach, VA
 
Union Finance
(757) 934-1537
1703B North Main Street
Suffolk, VA
 
CF Finance
(804) 643-8479
4660 S. Laburnum Avenue
Richmond, VA
 
Atomic Auto Title Loans Inc
(757) 318-7101
4465 Shore Drive Suite 1
Chesapeake, VA
 
Auto Title Loan Finance
(457) 524-4587
23, Crow St
Laurel Fork, VA
 
Tidewater Motor Credit
800-216-6862 x6932
6520 Indian River Road
Virginia Beach, VA
 
InterActive Financial Marketing Group
(888) 905-1002
114 Virginia St.
Richmond, VA
 
AutoLoansInVirginia.Com
Richmond, VA
 
Absolute Title Loans, LLC
(757) 410-8884
1100 Cedar Road Suite D
Chesapeake, VA
 
Credit Dispute Pro
(434) 239-4968
22634 Timberlake rd suite c
lynchburg, VA
 

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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