No matter how great of a deal you get on your used car, you still have to pay something for it—and there are a few different ways to do so. The simplest and best option is to just pay for your used vehicle in cash, plain and simple—but what happens if you just don’t have that kind of cash on hand?
There are three other options to consider—getting a direct loan, getting dealership financing, or going to a BHPH dealership. Here are some of the pros and cons of each financing method.
Getting a Direct Loan
Assuming you have reasonably good credit, you can get a direct loan from the bank—and nine times out of 10, this is going to be your best bet. As you consider getting a direct loan, keep these pointers in mind.
It’s always good to shop around, and to compare a few different quotes before you choose a loan.
You can do some of your research online, rounding up general information about reputable lenders.
Don’t forget to visit a local credit union; often, though not always, credit unions will offer the best rates on auto loans.
Getting Dealership Financing
Another option is to get a loan from the dealership itself. More often than not, dealerships are going to charge you steeper rates than what you’d get at the bank or credit union, but it never hurts to ask. Some advice:
Research bank loans before you get a quote from the dealership; that way, you have some frame of reference in mind before you talk to the F&I department.
If you can, at least pay cash for “extras,” like registration fees and warranties. You can roll these into your loan, but that’s just going to make your monthly payments higher, and you’ll pay more money in interest.
Buying from a BHPH Dealership
A final option is to choose a Buy Here Pay Here dealership, which effectively serves as your auto seller and your bank—but be warned: The rates here are usually astronomically expensive. We would frankly recommend this option only as a last resort. It’s simply not the most financially savvy way to get a used car.
Getting the Best Value on Your Next Vehicle
No matter how you end up paying for your next vehicle, buying it used can help ensure the best value possible—which is why we always recommend buying through a reputable used car dealership. And we’d love to connect you with one. Reach out to Get My Auto today, and let’s start the search for your next (affordable) car or truck.