Bank car loans

[schmitty]

I am looking into buying a new car and am trying to figure out how getting a loan from my bank as opposed to the dealership works. I assume I go to the bank first and get a loan for say 22,000. Once I go to the dealership I can get the car for 19,000. Do I already have a blank check from the bank to give to the dealership once I sign the papers?

 

[SC Minnie]

Also check out credit union rates. What we have done is gotten everything approved from our CU for up to the highest price we were willing to pay. Call the bank and find out what their process is.

The last time I used the CU everything was set up and they told me to write a check to the dealership for the price of the car and call them first thing the next morning with the amount. They moved the check amount into my checking account from the loan.

 

[golfgal]

Also check out credit union rates. What we have done is gotten everything approved from our CU for up to the highest price we were willing to pay. Call the bank and find out what their process is.

The last time I used the CU everything was set up and they told me to write a check to the dealership for the price of the car and call them first thing the next morning with the amount. They moved the check amount into my checking account from the loan.

I was going to say the exact same thing Credit Unions typically have interest rates at about 1/2 of the going bank rate. You get approved for the loan, write your own check (some dealers may need to see your loan paperwork to know the check is good) and off you go.

 

[schmitty]

I checked the CU I am a member of and their rates were worse than the bank and my credit card companies. Its almost a whole percent higher. Of course that could all change when I actually have it all set up but now initially my CU does not seem to be that good.

So generally the bank will say you can spend this much on the car, then once you sign the papers, you tell the bank what the final cost was.

 

[golfgal]

I checked the CU I am a member of and their rates were worse than the bank and my credit card companies. Its almost a whole percent higher. Of course that could all change when I actually have it all set up but now initially my CU does not seem to be that good.

So generally the bank will say you can spend this much on the car, then once you sign the papers, you tell the bank what the final cost was.

Pretty much. We have only had one bank loan on a car so it may have changed since we bought our first car back in '89 but basically they asked us what cars we were looking at, looked up the retail price in the Kelly Blue Book, approved us for a loan for the most that car would probably cost (we ended up getting one that was about $5000 less then what we were approved for), wrote the check to the dealership on Saturday, brought the paperwork into the bank on Monday and they transferred the money into out checking account.

 

[SC Minnie]

When we bought DH's car we were going to go through the CU like we did with my car. The dealership wanted us to finance through them. I got them to beat the CU's rate. Look up everything your bank loan would cover- the CU loan would cover gap insurance but the dealerships wouldn't. If they really want your loan they will negotiate with you to a point. If you go in with financing already planned you aren't at their mercy.