How do banks and auto dealers differ when it comes to the way car loans are given out?
I think that the car dealers will use the same banks as you would, if you were taking the loan directly. So basically it doesn’t matter. One thing is not too much convenient about the banks, is the huge number of supporting papers they request. Some banks will also force you to arrange life insurance. Another option would be payday loans in dc where you can take a loan with a simplified procedure.
Auto-dealers and banks differ in the following:
- Interest rates: Bank loans have a lower interest rate. The interest rate from banks goes from 1.88% to 2.7% per annum, and sometimes, 3% but that’s often the rate for used cars. Auto-dealers have higher interest rates that go from 4% to 4.7% per annum.
- Extra fees: There will be a processing fee or late fee that you’ll have to pay for. Banks also have lower fees and charges compared to auto-dealers.
- Approval Process: Auto-dealers have a more flexible approval proves compared to banks who most of the time have fixed standards for giving out care loans.
- Promotional deals: There are times when auto-dealers will present you with lower interest rates for specific car models. But be careful with these ‘deals’ because if you do your research, you’ll find that these promotional deals rarely make up for the price difference.
It’s better if you can get a car loan from the bank. The perks and deals might not be that alluring, but you’ll save more in the long run. GoBear helps you find a bank that can help you with your car loan so visit their website today.
