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346 Route 37 East, Toms River, NJ, 08753

Bank vs. Dealership: Where’s the Best Place to Get a Car Loan?

Tiny car with coins and finance paperwork

It’s a quandary that has affected many a Toms River driver: Should I do my car loan shopping at exclusively dealerships, or should I consider alternatives like banks and credit unions? The answer is, truly, “It depends”. Every driver is different. Every lending institution is also different. Even when you get a car loan at a dealership, it’s usually not the dealership that’s actually doing the lending (unless the dealer offers “buy-here-pay-here”, AKA “in-house” financing). Ready to learn more? Contact us at (844) 520-9001; we’re here to help! 



Car Loan Shopping

If you are wondering where to get a car loan, your main choices when car loan shopping loan include:

Car Loans from a Bank

Large banks such as Bank of America, Wells Fargo, Capital One, and more often provide auto loans. Some of the benefits of choosing a bank for your next car loan include:

  • Your pre-existing relationship and credit history with your bank
  • Set interest rates are common
  • Flexible payment schedules are sometimes possible

Car Loans From a Dealership

Car dealership finance centers, like the one here at Honda of Toms River, often have multiple benefits of their own that make them a great option. Here are just a few:

  • Dealerships generally work as an intermediary who is motivated to get you the best deal possible. This means that they’ll often be relentless about contacting a variety of local lenders to meet your needs. (Just be sure to be vocal about said needs so the dealer knows how to best assist you)!
  • It is easy to apply online for financing with a dealership. You generally only need to fill out one form to get multiple options. 
  • Many dealerships offer options for those who have issues with credit. Buy-here-pay-here dealerships, especially, can be a great route when looking to be approved for a bad credit loan (banks, by contrast, are often much stricter about who they approve).
  • The dealership may offer financing incentives such asdiscounts for militaryorcollege grads.

In-House Dealer Financing vs. Bank & Credit Union Financing

Financing that a car dealer secures for you is different than in-house dealer financing or financing from a bank or credit union that you secure yourself via sending out multiple credit applications. Here’s what you should know about all of your options:

  • In House Financing: In-house financing, sometimes called “buy-here-pay-here” financing is provided directly by a car dealership, so you don’t need to get approval from a lender. While this can mean higher rates to pay, it often means a lower bar of entry. If you have poor credit, this is the route to choose.
  • Credit Union Financing: If you belong to a credit union, you can apply for an auto loan there, and you may save money. Most Brick and Manahawkin drivers do not belong to a credit union, and thus, are not eligible for this route, but it’s definitely worth pursuing.
  • Bank Financing: When you apply for an auto loan at a car dealership, usually, the dealer sends that application out to different lenders. While this is most convenient, you can also secure your own bank financing in advance if you wish, though there is little reason to do so, practically speaking, the loan and rate you get, even with a dealer’s “finance reserve” added in, is still likely to be far less than what you’d pay by shopping around for bank financing on your own.

Discuss Your Financing Options at Honda of Toms River

Want additional information on car financing, how it works, and its many nuances and intricacies? Check out our special finance questions page, which we’ve compiled for shoppers just like you! In the meantime, if you’ve settled on car loan financing via a dealership as a suitable option, we invite you to apply online now to streamline your process. 


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