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Car Financing - How it Really Works Southaven MS

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.

Jackson, MS
Wells Fargo Home Mortgage
(662) 349-9999
7125 Getwell Rd
Southaven, MS
First Heritage Credit
(662) 393-4405
8995 Highway 51 N
Southaven, MS
Renasant Bank
(662) 342-1942
5779 Getwell Rd Bldg D3
Southaven, MS
United Credit Corp of Southaven
(662) 349-2274
1306 Goodman Rd E
Southaven, MS
Smith Mortgage Services
(662) 342-0006
155 Stateline Rd E
Southaven, MS
51 Title Loans
(662) 342-1470
7909 Highway 51 N
Southaven, MS
Title Cash of Mississippi Inc
(662) 280-5592
1399 Goodman Rd E
Southaven, MS
USA Cash Southaven
(662) 393-5501
2136 Stateline Rd W
Southaven, MS
Eagle Mortgage and Funding
(662) 349-4331
6858 Swinnea Rd Bldg 3A
Southaven, MS

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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