Getting an Auto Loan: Bank vs. Dealership

Before you sign the papers at the dealership, you might want to consider if you can get better interest rates and lower your payment by financing your next car through a bank or credit union.

Who Offers a Lower Rate?

Take a look at the pros and cons of getting a loan through a dealership or through an online lender. Banks, online banks and credit unions offer competitive rates for car loans. Just keep in mind that the lowest rates are offered to those with good credit.

The Dealership

If you want to finance through a dealership, make sure you know which banks they partner with and what their rates are.

Dealership Pros

Using a lender from a dealership is simple. The dealership will handle the necessary paperwork for you from the lender. All you need to do is sign.

Dealership Cons

You may not get the best rate, since many dealerships work directly with specific banks that may not have the best rates at the time you purchase your vehicle.

Online Lenders

Online banks are known for great interest rates, including auto loans. If you have an online bank in mind, find out if they are affiliated with the car you want to buy.

Online Lender Pros

Shopping around for the best online bank might be worth your time, since online banks typically offer attractive interest rates.

Online Lender Cons

There's no physical branch or location to turn to, in case you want to speak to someone, in person.

Top Auto Loans

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Comments & Questions

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Saturday, 16 Dec 2017 6:47 PM
<p>How to lower my monthly payments a month, on a car I just brought with a high interest rate that is 29%</p>
Wednesday, 23 Aug 2017 9:12 PM
<p>Gap protection is optional insurance coverage that applies to newer vehicles in the event of a total loss. For instance, you bought/leased a new car that has a value of $40,000, but it got totaled in an accident and the insurance check only paid your $35,000. You're stuck owing the difference. Gap protection pays for that difference.</p><p>The warranty you're speaking of may be a separate coverage that pays for various things, such as maintenance on parts of your vehicle (policy varies).</p>
Wednesday, 16 Aug 2017 3:05 PM
<p>Can someone explain to me what Gap Protection is, plus 7 years totally warranty?</p>
Tuesday, 19 Jan 2016 3:17 PM
<p>It's been month or so since my auto loan was approved but I have not received any payment book to make my first payment?????????</p>
Monday, 13 Jul 2015 3:26 PM
<p>Jo-Ann, I removed your address for privacy reason. To find out the remaining balance on your auto loan, you should contact your auto loan servicer for that information.</p>
Thursday, 09 Jul 2015 4:14 PM
<p>Can you tell me the pay off for my auto loan as of August 2015. My Name is Jo-Ann Choate</p>

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