© 2024 AutoWeb, Inc. All Rights Reserved.

Some content provided by and under copyright by Autodata, Inc. dba Chrome Data. © 1986-2024.

  1. Home
  2. Car Advice
  3. Buying
  4. How to Get a Good Auto Loan

How to Get a Good Auto Loan

By: StaffJuly 7, 20211 min

While the F&I department often makes the dealership money through add-ons, the bulk of its profit comes from arranging to finance for buyers in the form of an auto loan. Often, customers don’t realize that dealerships don’t automatically grant them a loan based on their qualification. Instead, they often add a few percentage points to the total and keep the difference. Over the life of the loan, this difference could add up to over a thousand dollars.

It’s possible to get a good deal on an auto loan, especially if the dealer is offering a special financing rate, but you’re going to have to take two significant steps:

  • Check Your Credit Score - Since the rate you receive on your car loan will be based on your credit score, you should take the time request your score. You are guaranteed one free credit report each year from each of the three reporting companies – Experian, Equifax, and Transunion – so this report is a great place to start. Check your credit report through a website like to make sure there aren’t any mistakes or fraudulent activity.
  • Get Pre-Approved for an Auto Loan - After you’ve checked your credit score, it’s time to get pre-approved for a car loan through a bank or credit union. First, compare loans across a variety of institutions online.

When you get to the dealership with a pre-approved great auto loan in hand, you’re free to negotiate the selling price of the car instead of the monthly payments.  Sometimes, the dealer will be able to beat your first loan, especially if he’s running a promotion. Even if he can’t exceed it, you’ll still save hundreds or even a thousand dollars more than you would have by just blindly walking into the F&I department.

1 car loan hand shake-adobe.jpg

Search Used Cars
  • By Make
  • By Type
  • By Price