The benefits of dealership financing – and why it could be a better choice than a bank
September 20, 2021
One of the many decisions you need to make when you’re in the market for a new car is how you’re going to finance it. For those of us not walking around with wads of spare cash in our back pockets, you may be curious about whether a bank loan or dealer financing might be the better option for you? We all have different needs and situations, so it pays to do your research.
For someone with plenty of time on their hands, shopping around the banks may seem like a good option to find the best deal – and it can be. But did you know, dealers have existing relationships with the lenders, and as they’re invested in the sale – it’s in their best interest to find you the perfect loan that suits your budget and lifestyle? They’ll also work extra hard to ensure you get your finance because, after all – they want the sale to happen as much as you do!
So, what are the criteria that would make you eligible for dealer finance? Firstly, with Torque Toyota you need to be at least 18 years old with a regular income; an Australian citizen, permanent resident or even certain Visa types are considered; and you must be purchasing a new, used or demo vehicle.
There’s a multitude of benefits to securing your finance through a dealership, including:
A quick, easy and convenient process
Let’s face it, we’re all time-poor, and there aren’t many of us who’d really enjoy calling around all the different financial institutions, splitting hairs to try and save a few bucks. Fact is, a dealership financier already has the relationships with the banks and lenders, and their goal is to make it an easier process to help sell more vehicles, which in most cases will give you the better finance deal.
And how’s this for convenience: With dealer finance, you can decide on a car, take out finance, and drive away – all on the same day! There’s also all that dreaded paperwork they can take off your hands, so why not let someone else do the heavy lifting for you?
It may help lower your finance repayments
Unlike most car loans, dealer finance can give you the ability to lower your regular repayments by making a lump sum balloon payment at the end of the loan term. Depending on your financial situation and preferences, a balloon payment can really help with your cashflow, allowing better access to your money straight away through having lower finance repayments.
And there’s no need to save up to pay it off if that doesn’t suit you, as there’s a refinance option, or a trade-in and re-purchase option, available at the end of loan term.
It gives you leverage to negotiate the sale price of your vehicle
Who doesn’t love a little friendly barter! At the end of the day, a dealer wants you to have a positive experience and walk away with the car of your dreams, at a price you can afford. A little negotiation can go a long way, for all parties involved.
With automotive industry statistics showing that over 90% of buyers borrow money from somewhere else to pay for their cars, while a whopping 50% of Toyotas sold by Torque Toyota are financed right here at the dealership, it’s certainly an option worth investigating!
Purchasing a vehicle is a big and very personal decision, so it’s important to do your research and select the financing option that’s going to suit you and your financial situation best. The first step would be to set yourself a budget of how much you’re comfortable spending per week, and then that will give you a good idea of what type of vehicle you can apply for.
There’s no cookie cutter approach to financing a vehicle, and our friendly Torque finance team are always available for a chat to discuss your options and help guide you in the right direction.