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Car Financing - How it Really Works Saint George UT

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.

Prestige Financial
(800) 984-6737
1420 South 500 West
Salt Lake City, UT
K P Processing
(435) 652-4160
144 W Brigham Rd
Saint George, UT
Easy Rv Finance
(435) 656-8600
32 S 2810 E
Saint George, UT
Wells Fargo Financial
(435) 673-8100
891 S Bluff St
Saint George, UT
Lucid Financial - Commercial Loans
(435) 656-8430
1173 S 250 W Ste 302
Saint George, UT
Speedy Loan
(435) 986-4000
234 E Saint George Blvd
Saint George, UT
Check N Go
(435) 986-4180
42 S River Rd
Saint George, UT
Zions Bank
(435) 673-5040
40 E Saint George Blvd
Saint George, UT
Mountain America Credit Union
(435) 652-1414
123 S River Rd
Saint George, UT
Mountain America Credit Union
(435) 656-0131
2104 W Sunset Blvd
Saint George, UT

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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