Bank loan vs. Dealer financing
October 30, 2009 9:14am CST
If you can find an offer for a loan from a bank and a financing offer from a dealer that have similar rates, which one makes more sense? The bank offers variable rate and structured payments. The dealer is offering flexible financing, meaning as long as I pay the minimum I can pay as much as I want per month. Or does it make sense to go in with a low interest crest card, and that way avoid the whole bank loan process, maintaining flexibility at a low interest rate? How does a bank lien compare to dealer financig in terms of repossesion in times of non payment? This will be this first time I am makkg a large purchase on some sort of line of credit, and I don't want to do it the wrong way.
1 person likes this
30 Oct 09
If I were you, I'd probably look into the contract first and then compare. You see, aside from the rates, there are a lot of things in the contract that could either make or break you, one thing is the acceleration clause wherein it states there that once you default payment even for once, the company has the right to sell your property without advising you, better watch for that.