Dealer-Financed Auto Loan

[justcallmebroke]

Has anyone here ever had a dealer-financed loan? Are they pretty reasonable, or are they all just rip-offs?

[Admin]

I wouldn't say all dealers will rip you off, but then where do you draw the line of getting ripped off. Remember that these guys are sales people and they will do their best to make your car buying experience as expensive as possible. From sales people to financing managers, they all make their money through commissions, so the more they charge, the more money they have in their pockets.

I recommend getting your car loan through an internet based financing company or your local credit union. You'll easily find better deals there, especially if you have a pre-approved amount of credit. This will give you more leverage in your bargaining power.

[justcallmebroke]

Your advice sounds like the way to go. Thanks.

[Jenita]

Know the value of your trade-in
Go through the classifieds of your local paper or use online resources like the Kelley Blue Book website or Edmunds.com to help establish a value for the vehicle you plan to trade in. Dealers handle trade-ins every day, and they often resell those vehicles in their used vehicle departments. The less they pay for your vehicle, the more profit they'll make when they re-sell it.

Know the true market value of your planned purchase
You should also use online resources like Edmunds.com and the National Auto Dealers Association website to help establish the invoice price and true market value of any vehicle that you might purchase.

Shop around
Once you've settled on a particular type of vehicle, visit at least three dealerships to find the vehicle that has the most features you seek at a price you can afford. You should leave each store with a firm sense of how much the dealer will charge for the vehicle you want to buy and how much you'll get for your trade-in. These figures will help you pick the dealer that seems willing to offer the best deal—and give you ammunition to negotiate an even better deal.

Feel free to test drive vehicles, but keep in mind that dealership salespeople consider anyone who has test-driven a vehicle as a "hot" prospect and may step up pressure on you to make a purchase that day.

[darsh999]

I don't think all dealers will rip you off, but then where do you draw the line of getting ripped off. we don't have to forget that this is their job they try their level best to satisfy their customer and we must give the money they want whether its too much From sales people to financing managers, they all make their money through commissions, so the more they charge, the more they can get profit ........

[fred333]

That is a great point.