Blog Post by chrisoutsidefinancialcom - 09/25/2018 06:23:21pm
Car prices are more transparent than they’ve ever been. That’s great for all car buyers. But what’s not great? The price of auto financing, including auto interest rates, is still a big secret. That’s why securing the right auto loan is more important than ever. Did you know that auto dealers now make most of their money on financing cars, not on selling them?
And it’s not just bottom-of-the-barrel hustlers who have become car loan sellers instead of car sellers. 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|
|Finance and Insurance||$1,075||$1,615||50% increase!|
When you rely on the dealership to arrange your financing, they’ll arrange a car loan that’s great for them. But what about you?
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.
Remember, you’re not just shopping for a car – you need to shop for a car 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.