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, and make your way from the Newark or Hoboken area to our dealership to browse our new vehicle inventory in person!

  • What Is the 2020 Honda Pilot Towing Capacity?

    Honda SUVs have already displayed how they can be fuel efficient and reliable on Bayonne and Newark roads and beyond. However, with the 2020 Honda Pilot towing capacity, you can add even more power to your commute. So, how much can the Honda Pilot tow? Metro Honda is here to break down this Honda SUV’s incredible…

  • What are the 2020 Honda CR-V Dimensions?

    Aside from its incredible reliability and safety, another one of the benefits of the new 2020 Honda CR-V is its size and build. The 2020 Honda CR-V dimensions offer Bayonne and Newark drivers plenty of cargo and passenger room so that everyone can stretch out and feel comfortable. Learn more about the new 2020 Honda…

  • 2020 Honda Pilot Trim Levels

    If you’re looking for the power, capacity, and performance of the big sibling of the Honda CR-V, then the new Honda Pilot is an ideal option for your Bayonne commutes and Newark weekend adventures. Explore all the 2020 Honda Pilot trim levels below to find the SUV that fits you with the experts from Metro Honda….

  • 2020 Honda Civic Technology and Exterior Styling

    Drivers looking for a compact Honda model for sale that can keep them moving on Bayonne and Newark roads and offer plenty of the latest advanced features should look no further than the 2020 Honda Civic. This updated model is packed with the latest technology features to keep you comfortable, connected, and safe, along with…

  • What Are the 2020 Honda Civic Interior Features?

    A reliable and fuel-efficient sedan can truly take your Bayonne and Newark commute to the next level, but to round out your ride, you’ll also want some outstanding features at your fingertips. With the 2020 Honda Civic Sedan interior features, you can get all the connectivity, comfort, and safety you need to take on the…

  • 2020 Honda Pilot MPG Ratings

    A fuel-efficient SUV can keep you moving, no matter if you’re in the Bayonne and Newark area or traveling far from home. And, the 2020 Honda Pilot MPG ratings offer up plenty of reasons why this Honda SUV is capable of getting to where you need to be and more. Take a closer look at…

Posted in Our Dealership