Car Buying Tips - Tripping During Dealer Finance

By Jeff Neilan

For this draft let's get into an area of the automobile purchasing process that will truly cost people enormous. Financing your automobile.

Each auto dealer has a F&I department and you can bet the house they are going to try awfully hard to get you to allow them to deal with the financing for you.

Simply based totally on my experience in the business and subsequently chatting with folks on the subject of getting your best vehicle deal; I should not be surprised at the amount of people that think car dealer financing is just this innocuous process that occurs at the agent that ties the deal together and allows them to join their payments and get on down the road.


Of all of the car buying tips to chat about auto dealer financing and what goes on in a dealership's FI finance and insurance office was a no brainer for me when thinking about some of the most common mistakes folk when it comes to vehicle buying.

Let me make this perfectly clear to you. A dealer's F&I dep. can be an excellent source of profit for the dealer!

But let's back up one moment. For whatever reason there's a great many of us that do not consider the financing or the cost thereof part of the cost of ownership puzzle or part of getting a good car deal.

If you do not. Then do. Or you will make many a vehicle dealer very happy to see you coming.

I guess it is due to the fact you don't actually "see" this cash leaving your current account each month. After all it is hidden within your car payment (basing your buying decision based totally on monthly payments is another subject for MASSIVE mistakes).

Take the time to take a look at the impact of rates and what you'll be forking over over the length of your car loan. And if you are automobile financing with a bit subprime credit on your side the fiscal implication can be very big.

Take a moment to consider this and just to give yourself a wake up call... Plug in a $20,000 loan for a car for 5 years at a modest 4 interest rate.

You can note that your payment comes to $368.33. Now change the rate of interest to 8% and you'll see your regular payment change to $405.53. A difference of only $37.20 month.

Hey that's just one night less a month to go out.


Well take your $37.20 times your 60 month loan and the most important difference between the two rates is a hefty $2,232.00. I do not know about you... But twenty-two hundred dollars is worth me taking the time to get my financing options in order.

You should positively shop your rate of interest!

Begin by getting (and knowing) your credit report. Regardless of if you have some difficult credit shop your interest rates. Sure they will probably be higher but there is not reason for them to not be competitive comparatively speaking.

Here's the bit about vehicle dealer financing and what I'm consistently amazed at when talking about this with people. Many people don't realize that when they get quoted and interest rate from a car dealer's finance department saving you even more.

But if they can't... Or won't... You can advance with the remainder of the deal with confidence understanding that you took the time to keep your financing costs as low as your possibly could.

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