You are bombarded with offers for a car loan. You see it every day on television, on radio, and in every edition of your local newspaper – the specials, promotions, and sales on new cars or trucks. Today’s deal is better than the yesterday’s deal and is so good that it will probably never be repeated within your lifetime.
In fact, if you believe all the hype that the car and truck dealerships are making, you have to wonder why they are still in business at all, since they are obviously selling these vehicles way below their cost.
Make no mistake about it – there are very few if any cars that leave the dealer where you paid less for the vehicle than the dealer did. That includes used cars and trucks too. They do not do business that way, and they never will because they would not be able to keep their doors open very long if they did. They get rebates from the manufacturers, incentive bonuses, volume bonuses, and more.
Yes, you may be able to get a killer deal on a particular make and model from one dealer that another dealer cannot match – not because they don’t want to, but because the first dealer gets incentive or volume bonuses that the second dealer does not in that particular month.
However, one of the things to realize is that one of the major profit centers for a car or truck dealership, new or used, is in car loans and car financing. Some dealerships have their own financing. Well, sort of, maybe, although most do car financing through an arrangement they have with a local bank or credit union.
Many larger dealerships have arrangements with multiple local banks and credit unions in order to make it appear that you have multiple options for getting the best deal on your car loan. In most cases, this is correct.
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