But that’s not how car buying works. Dealers prefer buyers who finance because they can make a profit on the loan – therefore, you should never tell them you’re paying cash. You should aim to get pricing from at least 10 dealerships. Since each dealer is selling a commodity, you want to get them in a bidding war.

Is financing a used car worth it?

The bottom line is, you’ll pay more to finance a used car than you would to take out a loan on a new car — and if the interest rate you’re paying is literally twice or three times (or even more) on the used car loan, it could actually make more sense to buy a new car.

How should you pay for a used car?

If you’re buying a used car at a reputable, licensed dealership, you can use just about any way to pay you want, whether by personal check, debit card, credit card, cashier’s check, or even cold hard cash. Just make sure you get a bona fide receipt if you pay cash!

Why do car dealers offer in house financing?

Because of the way dealers are compensated for setting up financing, there’s a built-in incentive for them to offer you the deal that is most profitable for them, rather than most affordable to you. That’s yet another reason to have an agreement in place that they have to compete with to get your business.

Who is providing the special offer on carsales.com?

* Where the vehicle listing contains the notation “Special Offer”, the Special Offer is being provided by a third party and is not being offered by or on behalf of carsales.com Limited. carsales takes no responsibility in relation to any offer made by a third party.

How does dealer assisted financing work for You?

When you decide to use dealer-assisted financing, they will bundle the purchase price of the car, your monthly payment, and the value of your trade into one neat transaction that’s usually centered on a monthly payment. While many customers appreciate the simplicity that it offers, it can also work against you, as we’ll discuss in a moment.

What’s the best way to finance a used car?

Instead, you’ll want to shop at lenders outside of the dealership, and have a preapproved financing deal in place before you step through the door of the dealership. Doing so also allows you to keep the focus on the vehicle’s purchase price, instead of confusing mashup of the vehicle’s price, the financing, and any trade-in you’re selling.