Consumers frequently finance most of, if not all a vehicle’s purchase price. This can be a sensible decision, however like all aspects of buying a car, doing your homework and being an informed consumer is important. Fortunately, OMVIC is here to help.

Find out what financing options are available to you

Before visiting a dealership, speak with your financial institution to ask about your credit rating and the options available to you. This makes it easier to compare the terms with financing offers available from the dealership.

It can also help potential car-buyers stick to a budget and consider if they can truly afford the vehicle and factor in extra costs – like parking, repairs and vehicle maintenance.

Dealerships often work with third party lenders

In many cases, a dealership arranges financing through a lender instead of loaning a consumer their own money. Once the dealer requests interest rates from the lender, they respond and provide the rates the consumer is eligible for. Although the dealer should offer the consumer the best rate, not the one that gives them the biggest kick-back from the bank, there are times when dealers offer financing that is not always the most competitive or most beneficial to the consumer. The onus is on the consumer to research the most appropriate and competitive financing that will fit with their situation.

Review your credit application

If you do make a request for credit at the dealership, be sure to review the application before it’s submitted and ensure you receive a copy of the paperwork. Credit scores can be negatively affected by multiple inquiries, so don’t complete an application until you’re committed to a vehicle, and always carefully read any agreement before signing.

Financing a new or used car is a major financial undertaking, and it can be complicated to navigate the application process, understand terms and conditions on a bill of sale, and the dealer’s legal obligations. OMVIC can help you better understand vehicle financing and what is in your best interest as a consumer.

More information at your fingertips

Before making any vehicle purchase, visit OMVIC for more helpful—and free—resources to stay informed and understand your rights. Consumers can also contact OMVIC’s Consumer Support Services at 1-800-943-6002 with more inquiries.