Consumer advocates suggest that you avoid auto loans at the dealership. Auto dealers are great at selling cars, but not the place to borrow money.
However, it's possible that the dealer is your best bet. Rates may be better, and the process may be easier. NetBanker Jim Breune explains why he recently financed an auto through the dealership, when he typically borrows online.
Breune wasn't able to get a loan due to his favorite lender's rigid policies, so he had to look elsewhere. It turned out that he saved money at the dealership and got to move on with his life. It goes to show that it always pays to shop around, and that blanket rules ("never ever borrow from an auto dealer") ignore complexities in the real world.
Conventional wisdom about lining up your own financing (through your bank, credit union, or online lender) makes especially good sense if you're not familiar with the car-buying process. When dealers focus solely on your monthly payment -- as opposed to other important factors such as purchase price -- you can easily get a bad deal.
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