Bad Credit Car Dealer Financing Vs. Bank Financing

When you are dealing with past financial problems but need to buy a vehicle, you have two basic options. One is to shop with a bad credit car dealer. The other is to look into basic bank financing. Both have their pros and cons, so you will need to make a wise decision. Past financial mistakes should not doom you to the worst possible loans, but you do need to be aggressive in your research if you want to get a fair deal. Benefits of Dealership Financing Dealership financing carries the strong benefit of being convenient. You can get your loan at the same place where you buy your vehicle. You do not have to worry about whether or not there will be financing available when you head to the bank after finding the car of your dreams. A bad credit car dealer, specifically, is valuable because they specialize in people facing your financial situation. They know how to creatively and effectively get financing for you, even when you have poor scores. They will provide options you may not find at a traditional bank. Drawbacks of Dealership Financing One drawback of dealership financing is the fact that it does not come directly from the dealership. Having a middleman can make it cost a little bit more. But, if you are willing to pay more for the convenience and more certainty that you get at a bad credit car dealer, then this is well worth it. Benefits of Bank Financing When you go to the bank for financing, you do not pay a middleman. You are getting the financing directly from the company that offers it. This can, sometimes, make it more affordable. It also helps ensure you get accurate information, because you will be working almost directly with the entity providing your financing, which is a good benefit when it comes to getting accurate information. Also, you can get pre-approval at the bank, so you can know for sure that financing is there before you start shopping for your vehicle. This can be a tremendous source of relief for you, especially given your current financial situation. Drawbacks of Bank Financing Banks do not specialize in bad credit loans, necessarily. This can be a drawback, because you may not get approval. Also, banks have more customers from which to get loan money, so they may be less motivated to lend to a risky borrower. You may face a denial even when your situation does not necessarily dictate it. So when the time comes to head to the dealership to start shopping for a car, you will have to decide whether a bad credit car dealer or a traditional bank is the right option for your needs. Both have benefits and drawbacks, and you may even want to see what your options are at both places, but in the end you will need to choose the loan that you can get approval for with fair terms.