Benefits of an Auto Loan from a Car Dealership

Auto dealer financing from dealerships such as Tustin Nissan or United Nissan, both owned by Don Forman, have many benefits, most of which the average consumer isn’t aware of. The benefits include:

Smoother Process

As opposed to spending a lot of time trying to secure a pre-approved loan from a third institution, an auto loan through a dealership ensures a quicker and smoother process with benefits that include flexible interest rates and extended warranties. This means getting a shortcut to owning a car and driving it off the dealership sooner than can be the case when sourcing your financing directly from a bank.

Convenience

Auto financing through a dealership makes the experience a lot more convenient. Rather than delivering or faxing important documents and having to travel to several locations to sign the paperwork, the dealership financing will save you all that trouble and a lot of time. An auto dealer can be the one-stop-shop that efficiently arranges all your vehicle’s financing requirements for you.

Easier to Qualify

For people with poor to fair credit, approval with in-house financing is more flexible. Although this doesn’t necessarily guarantee you’ll get lower interest rates, it does help people with bad credit. In that, if they make full monthly payments on time, in about a year or so, they can refinance the higher interest rate loan.

Build Credit

For someone who’s bought a vehicle using financing from a car dealership, they’ve probably noticed a huge jump in their credit score only a month or two after their purchase. There are long-term benefits of having an improved credit score which extends beyond the vehicle loan. With good credit, it’ll be easier to obtain approval for a rental property or to get lower interest rates on a mortgage.

Higher Advance

While many credit unions and banks are quite strict about their advance, car dealerships can arrange financing with competitive loan-to-value ratios. In as much as no one wishes to finance more than the car’s value, this may be necessary as more buyers trade in while upside-down on their trade-in cars.

Extended Terms

Car dealer financing may have more liberal loan terms. Most of the credit unions and banks only provide extended-term financing on demo or new vehicles. On the other hand, auto dealers can offer long-term financing on cars that are a few years old. Although extended terms are more expensive in the long run, they are a great option for buyers with a tight monthly budget.

Higher Financing Amounts

Some auto dealerships have the advantage of financing the entire amount of the car being purchased and the expenses accrued as a result of paying sales taxes, transferring the title, and any other licensing requirement.

All these costs can be rolled into the vehicle loan, then paid down with time. Although this makes the repayable amount larger than if you had paid for the extra expenses from your wallet, it’s helpful in completing the process without having to go back into your pocket.

You Aren’t Bound to the Agreement

Even though you’re expected to make full monthly payments on time, you have the option of refinancing if you change your mind or if you become dissatisfied with the deal you made with your auto dealer.