I have a question about dealer financing. I am supposed to take delivery of the TSX on Saturday, and would like to hear what people think about this situation. I have been approved for a loan through a bank at 3.99%. My salesman called me and suggested that he could get me 3.79% through a bank that works with his dealership (ie. not AHFC). I would assume that the dealership gets something nice from the bank for arranging this deal, but I don't really care about that. My question is: if the term is the same and the rate is 0.2% lower, is there any reason for the consumer not to go for the dealer arranged financing?



TEIGER

 

Just make sure you have all the details of each loan so that you can compare and contrast. One major issue is that banks often add 0.5% to the rate if you don't enroll in their auto-pay program. If you're not a fan of auto-pay, make sure to check that out.

You might also want to get the bank's name and do a check to make sure there aren't excessive complaints. Try going to http://groups.google.com and searching for the bank in combination with 'auto loan' or something similar.

 

Thanks shaf, I will definitely look at that site. I will be looking at the small print in detail, and be watching for little tricks like you mentioned. The bank mentioned is pretty reputable in this area, but you never know. . . A quick review at www.bbb.org shows no major complaints, so that is a good starting point too.

Anyone else have any other reasons to be skeptical?

TEIGER