How Finance Works

You could be on your way to buy your next car. Car Dealer Financing is a service and a website that works to connect financing for the purchase of a new or used vehicle. Despite possible credit problems, our service works with a network of car dealers who offer financing for bad credit customers, via in house financing or outside lenders. The ability to begin the process of obtaining car loans on line has made a noticeable difference in the type of loan options available to today's vehicle buyer.

The internet has opened up a large array of financing options for vehicles and almost anything else that is commonly purchased with financing. If you do not know how does a car loan work? Then read this. Vehicle loans are one of the most common financial arrangements. They are easy to understand and have very specific rules regarding payment, terms, interest, etc.

Loan payments are calculated on the value of the vehicle and the length (usually measured in months) of the financing. Interest and finance charges generally make up the monthly payment. The actual amount of the monthly payment is determined by the number of months that the financing is paid across. Most of the time, loans with a longer loan term will come with a higher interest rate. When financing a vehicle it is important to consider the value of the car over the length of the loan. If you plan to have the vehicle for long use amount of time you do not have to worry about residual value of the auto after paying it off.

However, if you do not expect to keep the vehicle very long you need to consider if you will have to pay additional money when trading in the vehicle due to negative equity (meaning that the vehicle is worth less than you still owe on the loan for it). If the vehicle is worth less than the remaining balance when you go to trade it in, you will be responsible for the difference.