How does inhouse car finance work?

I’m looking to getting a new car but I don’t know much about financing. A lot of our local dealerships say they do in-house car financing. How does it work?

Answer
“Terms and conditions around financing can be confusing!
When you decide to buy a car, you typically have two options if you’d like to get a car loan. Either in-house with the dealership or outside through another lender, like a bank or credit union.
In-house car financing tries to make everything easy. Once you decide on a car you like, the dealership will handle all the paperwork and financials. Because of this, dealerships with in-house financing are also called buy-here, pay-here.
Unlike traditional lenders, dealerships often don’t judge your loan worthiness by your credit score alone. If you have bad credit or no credit, in-house financing can be useful. However, since the dealership controls the loan, you may spend more money on interest or have less favorable terms than through a bank or credit union.
No matter where you get financing, try to do the following:
If you’re considering financing your car, be sure to budget for the cost of insurance as well. You can get personalized car insurance quotes easily with the Jerry app. Jerry gathers quotes from the top 50 insurance companies, making it easy to budget for your new car!”
Lauren Smith
Answered on Oct 13, 2021
Lauren has written for World Nomads, the Matador Network, Korvia Consulting, and once upon a time Three Fates Games. She graduated from Columbia College of Chicago with a BFA in Creative Writing. After graduating, she moved overseas and lived in South Korea where she spent her free time traveling and going on road trips with friends. She misses the rest stop potatoes and is trying to figure out how to recreate them at home. She's now based outside of Chicago and when she's not writing she spends her free time reading, playing video games, and exploring whenever she can.
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