Looking to buy a car? Not sure where to start with financing?
Car shopping is not something light, especially since it involves a ton of money. It is even more so if you are being careful and thorough on your purchase. Anyways, that is actually a trait that must be commended as you are exercising care and caution for your finances.
Now, there are two of financing options for such purpose. That would be direct lending and dealership financing. Let’s see where they differ. Take this opportunity to see which would work better for you.
By definition, direct lending is when you can directly get a loan from sources like a bank, a finance company or a credit union. For a period of time, you will have to pay the amount you need, plus a fee. When you go to a dealership to sign a contract for your chosen automobile, the lending company will then be the one to pay for it accordingly.
What is good about this method is you will get to compare these lending sources and decide for yourself which has terms that are most beneficial. It can be that one has a lesser interest rate than the other.
At this time, we will talk about dealership financing. This is another way wherein, as its name suggests, financing will just be through the car dealership itself. The system is the same though; you will have a duration to follow in regards to your payment, and this will be with a charge as well. There will be the involvement of a bank, a finance company or a credit union though as they will act as the assignee to receive your payments.
This proves to be convenient as there is only one location for any of your needs like for the condition of your automobile or for your financial concerns. And because the dealer has been tackling financing a lot, they have a wider range of choices when it comes to banks and finance companies. They can be able to arrange a deal that is advantageous for you.
Which do you think is for you? Just don’t forget to take your time and be active and involved in comparison shopping. In the end, you are the one who will benefit with your car and your money.