subject: Getting finance from a car dealership [print this page] Getting finance from a car dealership Getting finance from a car dealership
When buying yourself your next car you are probably going to need finance and a rather hefty deposit. Most of us will take our current car to the dealership and hope that the residual value of our current car covers most of this cost or we would go to a bank in the belief that they provide better rates and try to secure a loan.
However selling your car to buy your new one is a little more complicated than relying on the APR value quoted by the financial provider. You should first check and obtain a quote from each company that can offer you the finance, including the dealer you are buying from.
Often, large Car Supermarkets, have accounts with finance company's that allow them to negotiate the interest rate of a loan. This gives them a lot of leverage when building your finance quote and can work out to be far less expensive than a loan from the bank.
It is common for a loan from a car dealer to show high interest rates and APR values because in many cases they are able to use your existing car to reduce the overall amount borrowed and modify the terms of the loan. If you obtain a quote from a dealer you should always look at the amount you would repay in total (and the interest you would pay) rather than the APR value or the interest rate.
You should also allow the dealer to select a price for your current car as its value, and the amount a dealership is prepared to pay for the car is a factor in the finance, but you should always aim to get the best price for your car.
Most people feel more comfortable when negotiating with a dealer if they already have an offer for the car that they can quote. It also acts as a safety net so that if the deal fails you still have an offer for your car. Websites like Car Arena are a good place to quickly and easily get a value for your car.
