For many inexperienced car buyers, the process of getting dealer financing can be difficult and confusing. The dealer’s will often try to throw you curve bars and confuse you by presenting you several sets of numbers and tell you they are giving you the best deal possible when in reality, they are not. It is your responsibility as a consumer to do the research and know how car financing works so that you can negotiate with the financing department to get a fair interest rate on the loan. There are a number of things that you can do as a consumer to prepare yourself for this process that will help immensely.

A person’s credit score is a factor that will heavily influence the interest rates and the financing deals that you will be able to get from the dealership Having a good credit score will mean that you will be able to pay less interest and less for the car overall Persons with bad credit scores are more susceptible  to higher rates, longer loans and higher payments. Every time you apply for dealer financing, they will run your credit and they may or may not be upfront about what they find. Even if your credit is reasonable a dealer may convince you that it is not if they think you are unaware of your score altogether. It is important that before you attempt to negotiate interest rates and apply for financing that you take the extra step to obtain a copy of you’re credit score and to be aware of anything on it that may affect your financing application. For best results this should be done a few weeks to months before attempting to purchase a vehicle because it will give you the opportunity to contact your creditors and pay down your debts or make arrangements to do so to help repair and raise your credit score. Also, if when you do apply for financing the dealer tries to tell you that your score is less than what you know it to be, ask to see a copy of the report. The are required, by law, to show it to you upon request.

Before you begin the process of applying for financing through a dealership, call a number of other lots and financing establishments (including the one you may be buying from)  and ask them to run the numbers for you and give you an estimate of what kind of financing may be available to you without letting them know you are interested in a particular vehicle. The average of these quotes should give you an idea of what type of interest rate you are likely to get on your loan. Keep handy the numbers the dealership gave you over the phone and when it comes time to start negotiating finance options, be ready to flash them if they try to offer you a less than favorable agreement.

Many dealers will try to approach buyers by negotiating monthly payments, overall costs and interest rate all at the same time. It is up to you not to let this happen. The sales men will present you with many sets of numbers and data all rolled into one to try and get you to agree to a deal where you are paying more than necessary. Remember, the sale price of your vehicle has nothing to do with financing and interest rate so remember to haggle them separately. Neglecting to do so will ultimately cause you to have to pay more than necessary.

Financing can be scary for those who have not been through this process before. The more you know about your own credit and how dealer financing works, the better prepared you will be to negotiate face to face with a dealer.