Alternatives to Car Dealership Financing

There are several alternatives to car dealership financing which should be considered prior to entering in to any agreement. As car dealership financing comes in a huge variety of different types, it is also imperative that one reads very carefully the small print in order to have a precise picture of what is truly being offered.

Car dealership financing is very often only a viable option in a financial sense when one is considering purchasing a new car. These deals are far less commonly available in a favourable sense on older cars, due to the lower level of profit for the dealership. When one is therefore considering a new car, it will frequently be the case that some version of zero percent finance is available on the deal.

When a car dealership speaks of zero percent financing, however, it is often a little more complicated than it at first appears. The financing aspect of the agreement will indeed be at zero percent interest but the likelihood is that there will remain a sizeable outstanding balance at the end of the agreement period which will have to be paid in full, one way or another.

The obvious alternative to car dealership financing would be to pay for the car purchase in cash from one’s savings. This is of course not a luxury available to everyone but even where it is possible, one should still consider a decent zero percent car dealership financing offer. This would mean that the savings could be left to gain interest while no interest was paid on a fixed term loan and the balance simply cleared from the savings at the end of the term.

A personal loan from one’s bank is also a viable alternative to car dealership financing. This could either be because the bank are charging a lower rate of interest than the car dealership for financing, or that the loan to the bank is repaid in full with no lump sum outstanding to worry about at a later date.

There are more and more companies getting involved in the unsecured credit market in modern times. These companies include insurance companies, travel companies and even large retail outlets such as supermarket chains. Checking Google for an Internet comparison site for personal loans may indeed therefore prove to be a few minutes very well spent.

It is important to consider all viable alternatives to car dealership financing in order that both the right type of agreement is obtained for one’s own personal financial circumstances and that the ultimate cost of purchasing the car is as low as possible.