Mama Bear Blog


Why the right auto loan is more important than ever

Blog Post by chrisoutsidefinancialcom - 09/25/2018 06:23:21pm

Why is the Right Auto Loan More Important Than Ever?

Consumers are now better informed than ever about the price they should pay for a car. That’s great for buyers, but it’s also why they have to be extra-careful: auto dealers have switched from making most of their money on selling cars to making money on financing those cars.

And it’s not just bottom-of-the-barrel hustlers who are doing this. This table shows how one of the largest auto dealerships in the country makes their money. Over the past 10 years, profits from selling new cars have decreased by ~15%, while profits from the Finance & Insurance back office have increased by 50%!

Where’s the profit? 2006 2016 Change
New vehicle sale $2,211 $1,902 14% decrease
Used vehicle sale $1,816 $1,509 17% decrease
How much are you paying in markups? Check out the Outside Financial Markup Index to crunch the numbers for yourself!

When you rely on the dealership to arrange your financing, they’ll arrange a loan that’s great for them. But what about you?

Shop with the power of a cash buyer when you bring Your loan

Cash buyers don’t face these dangers or suffer these penalties. You can shop like a cash buyer, avoid all these headaches, games, and get in and out of the dealership fast, if you arrange your financing before you go to the dealership.

Bring your loan (and you ‘bring the bear’)

Remember, you’re not just shopping for a car – you need to shop for a loan too. Going with ‘Outside’ financing means you know the fair price for the car you’re buying – AND for the financial commitment you’re making when you buy that car. It means you know the fair price for a loan AND for a vehicle service contract or GAP waiver if those make sense for you.

It’s very hard to catch all the financing fine print in the rush of buying a car – but that could be a mistake that costs you $1,000 or more.


So if so many people do so much research online before buying a car (14 hours on average), why are most auto loans still arranged the same way they were 20 years ago – in the dealership’s back office? Here’s the missing piece: until now there’s never been an easy way to understand your financing options that’s quick, transparent, and independent. Now there is.

You deserve to get a great deal on the car you need – by getting a better loan. It’s time to Go Outside.