Credit for auto loans is easy right now and rates are low. However, loans offered through car dealerships aren’t usually good for you. Dealerships typically receive kickbacks from banks, so they have an incentive to sell you a higher rate than what you may qualify for through your bank or credit union. Also, because many don’t read the fine print when the sales person is hovering over them awaiting a signature, many don’t know how the terms and conditions may change or may simply be teasers. Seeking a conventional loan through your bank or credit union is an easier process.
Keep in mind, too, that there are a lot of scams out there. We received a similar “prize” as mentioned in this article not too long ago. Fortunately, we’re not interested in a new car right now. We can see, however, how some may see this as a legitimate prize.
Finally, be cautious with sub-prime loans for cars, just as with homes. If you can only qualify for a sub-prime loan, you will pay an extremely high rate and it may become something you cannot afford. Don’t get caught up with the emotion and excitement of the new car. Be practical and do what’s better for you in the long run.