How Does Auto Financing Work?
Auto financing is an area in which a great car deal can suddenly turn sour. Many car buyers spend an enormous amount of time and effort getting a dealer to agree to a low purchase price and a decent trade-in value, and then they throw all that hard work away by failing to be nearly as diligent in obtaining their car loan. Their lack of preparation on the equation's financing side means they potentially throw away hundreds, or even thousands, of dollars.
To get the best deal, it is critical to understand the answer to the question: how does auto financing work? Happily, free online sources are available to help you get the best deal without ever leaving your home.
With a traditional vehicle purchase, there are typically three separate transactions:
- The car-buyer is purchasing a vehicle
- The dealer is purchasing a vehicle (the car you're trading in)
- The car buyer is purchasing financing
That last transaction is the subject of this article. With auto financing, a lot of money is at stake. Yet, many consumers treat it as an afterthought or don't even think about it at all. That's a shame because you can save hundreds and perhaps thousands of dollars by using online resources and techniques to get the best deal on a car loan.