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Car Financing - How it Really Works Roswell NM

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.

Santa Fe, NM
Beneficial Finance Branch
(505) 623-1734
4504 N Main St Ste F
Roswell, NM
Wells Fargo Financial
(505) 623-5920
2601 N Main St Ste C
Roswell, NM
Beneficial Mortgage Co
(505) 622-3820
324 N Richardson Ave
Roswell, NM
Primesource Mortgage Inc
(505) 622-5113
1112 N Main St
Roswell, NM
USA Title Loans
(505) 625-5555
205 S Main St
Roswell, NM
Production Credit Assn
(505) 622-6870
2730 N Wilshire Blvd
Roswell, NM
Wells Fargo Bank Na
(505) 622-3494
2900 N Main St
Roswell, NM
Check Into Cash
(505) 622-0965
2415 N Main St
Roswell, NM
Liberty Finance Co
(505) 623-5457
616 S Main St
Roswell, NM

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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