Dealership Financing and Out-of-State Purchases

Should I finance through a dealership? What do I need to know about buying out of area?

Should I get my own financing, or get financing from a dealership?

So I know across the country we have a lot of challenges with trust in a dealership, and one of the questions I get all the time for my friends and neighbors is, "Should I get my own financing, or get financing from a dealership?" 

New Car Financing

If it's on a new car, it's very likely the manufacturer's financing will be better than anybody else's you can find because a lot of times it's an incentive. Subaru of America works with Chase and they call a Subaru Motors Finance, and right, the rate they can get today (when we're shooting this video) is you can get 0% on some of our cars. Well, banks don't really loan at 0%, that just means Subaru is helping to pay that interest for you. Okay, so on a new car there isn't going to be another local bank or a regional credit union that's going to be able to compete with that rate.

Used Car Financing

Now on a used car, it may be true. We live here in Boise, we have a great local credit union, Idaho Central Credit Union. We work with them all the time and they do a great job for our customers, they do a great job for their customers, and they offer fantastic and competitive rates. Now a person can go to ICCU and get a rate, but the benefit of working with the dealership is where you might get one loan with Idaho Central Credit Union or your local credit union or we'll say a great bank like Wells Fargo, you may get one loan every three years or five years, we do 50 to 60 transactions with what that Bank per month. We do 300 with them in a quarter, so we will often get an eighth or a quarter percent better interest rate through our store then you get walking in. 

Educate Yourself a Little Before Visiting

The key thing for you to know where you fall at is going to be looking at a place like Bank Rate, or next time you're in your bank or on your bank's website just see what they offer on auto loans. That will give you a great range because on used cars, year (how old the car is) and miles will also change those kinds of things, even your down payment can change it. Then of course the number one factor is your individual credit score. But as long as you're a little educated before you go into a store, you don't have to be afraid of a dealerships financing.We have great financing and typically better than you can get on your own. So, just understand what you should be getting before you go in. You know, if you saw three and a half, get the details of what you saw that rate is at your bank. You know maybe it'll say you have to have 20% down or has to be on our new car. Understand it that way when you go to the to a dealer and you're working through the process and you see a rate that's within a half or a quarter of where you were, you're in great shape. Just take advantage of it and go on. Like I said it might be a little bit higher by an eighth, it might be a little bit lower, but just pay attention so you know what range you're going to be in when you get there. 

What Should I Know About Buying a Car Out-of-State, or Across the Country?

We've all heard stories about a family member, a cousin or someone that got a better deal on a car because they went across the country to buy it. And it's true, we're here in Boise and we recently sold a car to a great customer that lived in Milwaukee, Wisconsin. Right, it was a very specific car, but in most cases the trick to traveling across the country isn't going to be the solution for what you need. And I'm not saying don't look if you're looking for a very specific, rare vehicle. Using a company website like Car Gurus or Auto Trader, eliminating zip code search and searching the whole country might be the only way you find it. Whether it's a collectible or a car they only made a few hundred of, it might be the only one the whole country is five hundred miles or two thousand miles away and that could be for you. But if you're looking at a new car manufactured by virtually any manufacturer, whether it's a Subaru, a Honda, Ford, it's likely you shouldn't have to travel across the country to get a great deal. Typically if someone leads with a very low price upfront, it could be they're tacking on fees or not disclosing everything as part of that transaction. Now it could be they have a great value, so my tip would be before you decide to jump on a plane to fly 500 miles or five thousand miles to buy a car, get the entire transaction done before you show up there. 

Tips for Purchasing a Vehicle Far Away

#1 Get an Invoice

The key to doing this is getting an invoice so you know exactly what options are on the car.

#2 Get a Purchase Order

A purchase order will detail everything you need and will be disclosed in that car. So it'll show things like the price of the car, any discounts, all the equipment, any kind of accessories or hidden fees, all of these have to be disclosed on a purchase order. 

So it may be the best deal on the planet for you is a thousand miles away, but don't make the trip without getting a purchase order first. That way you don't get there and you get the surprise of understanding, "oh, they didn't put in the destination or delivery or they didn't add this package that I didn't pay attention to." Because every dealer that's a Ford dealer, or a Subaru dealer, or Honda dealer, they all pay the same thing for the cars. So just pay attention to that before you go, and then double-check that dealer rating. If someone has a really low price within a really low dealer score, like on Google or Facebook, pretty good indicator that people get there and things aren't quite what they thought they would be.
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