Bank vs. Dealership: What’s the Best Place to Get a Car Loan?

Couple sitting at sales desk at dealership

Thinking about financing is one of the key parts of purchasing a new vehicle, so knowing where to get a car loan is vital for every Nashua driver. Your two main options are going to be the dealership where you’re purchasing the vehicle or a bank or other lending institution.

Each offers its own benefits, so read on for help choosing between them.

Why Take Your Car Loan from the Dealership?

Many Portsmouth drivers will tell you dealerships are the best place to get auto financing, and it’s easy to see why once you check out the benefits. Just a few reasons to finance with a dealership include:

  • Dealers will work with a variety of lenders to provide the best rates possible.
  • Dealers can help you decide between leasing and buying.
  • Dealers make it easier to apply for financing – you simply fill out one form.
  • Dealers often offer financing for drivers with poor or no credit.
  • Dealers often offer financing incentives to help you save.
  • Dealers sometimes allow you to negotiate your down payment.

Why Take Your Car Loan from the Bank?

Go car loan shopping with banks and you’ll have trouble with anything less than a good credit score. You’ll also need to talk things through with your dealership first since they will have several different financing partners.

However, benefits for Portsmouth drivers with a pre-existing relationship with their bank include:

  • Interest rates are usually set.
  • You can sometimes arrange a flexible payment schedule.

In House Financing vs. Bank/Credit Union Financing

One thing to keep in mind is the difference between financing that actually comes from the dealer (in-house) and financing they secure from a bank or credit union. Here’s what you need to know:

  • In-House Financing: Sometimes called ‘buy here pay here’, going in-house means you don’t need to get approval, but it can also mean higher interest rates.
  • Bank Financing: The dealer will send your application out to different lenders to see which offers the best package.
  • Credit Union Financing: If you belong to a credit union, you can sometimes save by applying there instead.

Visit our Stratham Finance Center Today

We appreciate that financing can be a stressful process, so we’re always happy to provide assistance and make things as simple as possible. For any further information or advice, feel free to contact one of our team today. Want to know what a good interest rate is? We’ve got a handy guide to help!

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