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Top 8 Car Financing Myths

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Visiting a car dealership for the first time is an interesting experience. You’ll get to hear some pitches that sound enticing while others are downright ridiculous. And the bad news is you might not identify what the truth is anymore. Your mind might not be able to keep up with all the pushy sales talk.

So, if you encounter this traumatizing experience, we’re now ready to debunk this “urban legends” that terrorize every car shoppers.

Myth #1: Lower monthly payment

Do the math. If you have a lower monthly payment, the charges will be spread to longer terms. And with this, the interest rates will accumulate over time and be larger than it is. So, if the sales talk reached to this, don’t be amazed at this offer. Technically, he’s pulling a one on you.

Myth #2: Exclusive and limited time offers

Marketing at its finest. Some salesperson will always take advantage of human nature against you. The urgency of things always interests us. If their pitch opens up with this,” Only 4 stocks are left…”, be on the lookout. Chances are it may be true or he/she is lying.

Myth #3: In-house financing

While bank financing is stable and secures, in-house financing is not a bad alternative. They offer comprehensive selection of cars that you can choose from. You can also negotiate your way here and have a personalize payment arrangement.

Myth #4: Rainy day or holiday

There are no definitive lucky days for car shoppers. Even if it’s raining or a holiday, you’ll still have the same experience as usual.

Myth #5: Online car deals and their ads

Nothing beats a physical store. Online car shop has a creative marketing but takes a close look at the deals. There are more competitive rates if you take the time for extensive car hopping.

Myth #6: New and used car

There are also ways to buy used cars that are less than 10 years old. Buying  a used one will not necessarily mean  you save on money. This also stays true to buying a new one.

Myth #7: Straight-down cash

While paying cold cash is possible, it’s not really preferred by a dealership. They will likely make a profit out of you if you apply for financing. This way, they can charge you for rates and other fees.

Myth #8: Vulnerability on negotiating a good deal

Car dealers might disarm you with humor and offer you a warm hello, but always remember, they’re making a living out of this. Don’t say outright  that you’re incapable to work out a good deal. While there are genuine dealers that will find the best deal for you, there are  also establishments that will max your money for better profit.

Take note too to know your credit score before applying. Not knowing might allow some salesperson to make use of this to offer you higher rates.

If you want a higher chance to receive the most reasonable offer, aim for a higher credit score. This resource might help you to assist on that goal.

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