3 Automobile Financing Options to Consider

Most of us need an automobile we can’t afford to pay with cash. That’s the reality these days. We finance instead of purchasing outright. There are three kinds of automobile financing drivers consider when they find a car. They are direct lending, dealership financing, and leasing. Each has advantages and disadvantages. Here’s what you need to know.

Direct Lending

Direct lending means getting a loan directly from a bank or finance company instead of through a dealership. Advantages of this are as follows:

  • Shop around. You don’t have to get a loan from your usual bank.
  • Have everything ready before you purchase. When you have a loan deal set up, the dealership can’t use financing as another negotiable variable in the deal. This eliminates another opportunity for them to get more money out of you.

Dealership Financing

This is the kind of financing you get at the dealership. The dealership usually lets a financial company handle things once you’ve signed a contract. Advantages are as follows.

  • Convenient set of options. The choices won’t overwhelm you, but there should be a good range of options.
  • Special deals offered through your dealership and their partner banks might save you some money.

Leasing

This is when you don’t own the vehicle but you drive it for a specified time period and choose a range of conditions. There are some distinct advantages to it.

  • Inexpensive. It’s usually cheaper each month than other financing options.
  • New Vehicle! You get a new vehicle and you can trade it for another in a few years.
  • Tax savings. You can usually save on taxes.
  • Flexibility. You do have to limit yourself to a number of miles each year and to a lease period, but everything is flexible. The monthly rate is not set in stone!

Now that you know your options, determine what will fit your lifestyle best. Have you ever thought about getting quotes and comparing options online? BuyingAdvice.com makes it easy. Get free quotes with no obligations involved. Click here to fill out our secure form. You can also compare loans easily by requesting an email with the lowest APR% offers. Click here to learn more.


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