Auto Loan Process at Dealership

Quick Summary

While a variety of lenders offer auto loans, one of the most common sources is right there in the building: Dealership financing. In this case, you contract with the dealer and take a look at the financing packages that they provide. Because you're acquiring a loan through the same place that you are buying your car, you don't need to get the loan first – in fact, many people make an offer on a specific car before getting to the financing stage. Dealership loans should typically be used for newer cars or very good used cars – nothing over 10 years old, for example, and preferably on a vehicle worth $7,500 or more.

Dealership-based car loans come in many shapes, with a variety of discounts and a lot of fine print that you need to read. Patience is key if you are studying these loan offers, which is why it may be comfortable to do so from your own home, using Loanry's loan comparison services. This method can helps ensure that you understand everything on the loan and aren't pressured to accept anything until you are ready to buy.

Advantages & Disadvantages


-Test drives. Completing a loan at the dealership gives you an opportunity to test drive a model and see it up close. If you don't like what you see, you can easily back out and reassess your options.

-Some room for negotiation. Every dealer handles negotiation a little differently, but they are often more open to negotiation before the lending stage, especially if they are the ones handling your financing. This can help you get a better deal, especially on used cars.


-Not all dealers are the same. Not all dealers are interested in finding strong financing choices for your financial situation. Loanry works to find preferred dealers with a healthy track record of customer involvement to avoid these problems.

-Inventory is not guaranteed. The exact model that you want may not be there, especially if it comes to used cars.

What Should I Know About the Auto Loan Process?

Always explore your options! Sometimes dealership loans are effective, trustworthy, and speedy. At other times loans from other sources (like banks) can provide more timely loans with more fitting terms. This depends on many different factors – including your location – so make sure to take a look at all your loan options, dealer and otherwise. Remember that you are not required to use dealership financing. With Loanry's help, you can quickly examine offerings from different lenders to get a better idea of what is available…and what's a smart decision.