Which Car Loan is Best – Dealership or Bank?

December 9th, 2017 by

2018 Honda Accord Work

Whether you’re searching for a new or used car in the Jersey City area, it’s likely that you’ll take advantage of car financing. However, it’s important to do your research before you sign papers at the dealership so you can ensure that you get the best interest rates and lowest monthly payment available. Find out whether financing through the dealership or through a bank or credit union is best for you, then rely on the Metro Honda finance department to walk you through the process!

How to Find the Lowest Rate

There’s no surefire way to tell whether your dealer will offer a lower interest rate than your bank; in many cases, dealer financing is actually the same as bank financing. The dealer simply goes to the bank and does the legwork for you. However, it can be beneficial to go to your bank before choosing your vehicle so you can find out their rate first. Then, you can compare that to your dealer’s and see if your dealer can match the rate if the bank’s is lower.

Dealer Financing

  • Pros: Automakers will occasionally have promotions where they offer very low interest rates on new cars, which a typical bank wouldn’t do. Dealers will also “shop around” so to speak, and will find the best bank rate in the area.
  • Cons: Dealer financing is a common option because it offers the simplest route to buyers – they can choose and finance without leaving the dealership. However, it’s important to ensure that your dealership isn’t marking up the bank’s rates in order to make money.

Bank Financing

  • Pros: The main advantage of car financing through a bank is that they won’t mark up interest rates as some dealers might. Because of this there’s no middleman, so rates could potentially be better.
  • Cons: You can negotiate interest rates with your dealer, but banks will typically offer just one rate. They also won’t shop your credit around to lenders like dealers do.

Rely on Metro Honda for All Things Finance

Whatever financing route you choose, you can count on our experienced finance department to help you through every step of the way. Contact us for more information and car buying tips like calculating interest rate on a car loan or trading-in a financed car, and make your way from the Newark or Hoboken area to our dealership to browse our new vehicle inventory in person!

  • 2021 Honda Civic Colors

    The new Honda Civic is available in a wide variety of colors, from subtle tones to vibrant hues that are sure to turn heads on Bayonne streets. The Metro Honda team is certain that you’ll find a Civic color that will be the perfect match with your personal style, What are the Honda Civic color options?…

  • What are the 2021 Honda CR-V Dimensions?

    The compact Honda CR-V dimensions make it an ideal choice for navigating busy Bayonne streets. But don’t let the smaller size of this crossover SUV fool you! The interior is surprisingly spacious, with comfortable seating for up to five and plenty of cargo space. Learn more about how the CR-V interior and exterior dimensions will…

  • 2021 Honda Accord Trim Levels

    The Honda Accord has received praise from Car and Driver for being a “practical and fun-to-drive car,” and the team at Metro Honda believes you’ll find this stylish midsize sedan to be a perfect choice to upgrade your Newark driving experience. There are nine Honda Accord trim levels available, each loaded with features that will add…

  • 2022 Honda Odyssey Interior

    The 2022 Honda Odyssey interior is spacious, versatile, and loaded with convenient features that will help keep your Bayonne-area family comfortable, entertained, and safe wherever you drive. Learn more about the Honda Odyssey interior dimensions and features in this guide from Metro Honda, and then contact us to schedule a test drive today! Odyssey Inventory Odyssey…

  • 2021 Honda Passport Price

    When it comes to finding a reliable mid-size SUV that’s perfect for your next Bayonne adventure without breaking the bank, the 2021 Honda Passport price is sure to impress. With a base $32,790 MSRP* on the Sport 2WD with 9-speed automatic transmission option, along with three other unique trims, you can bring home an affordable…

  • 2021 Honda CR-V MPG Ratings

    If you’re in the market for a fuel-efficient, compact SUV for sale near Bayonne, the 2021 Honda CR-V ensures that you can get to your destination with as little gas as possible. Not only can you look forward to saving money on fuel, but the CR-V also offers both gas and hybrid options so you…

Posted in Our Dealership