{"id":2027,"date":"2020-04-15T07:09:16","date_gmt":"2020-04-15T07:09:16","guid":{"rendered":"https:\/\/www.consumerslaw.com\/blog\/?p=2027"},"modified":"2020-06-02T16:27:06","modified_gmt":"2020-06-02T16:27:06","slug":"understanding-auto-loan-financing","status":"publish","type":"post","link":"https:\/\/www.consumerslaw.com\/blog\/understanding-auto-loan-financing\/","title":{"rendered":"Understanding Auto Loan Financing"},"content":{"rendered":"

\"Auto<\/p>\n

Cars, trucks, motorcycles, RVs or boats, they’re all expensive. \u00a0It’s unusual that these purchases are made in cash. \u00a0Whether buying a new or used vehicle, most people choose to finance the purchase and make specified payments over a designated period of time.\u00a0 Financing\u00a0can be arranged in two different ways.<\/p>\n

Dealer-Arranged Loan<\/h2>\n

\"GettingMany times consumers have the dealer arrange for financing. \u00a0The dealer’s finance manager, or “F&I”, will collect your personal information and forward it to prospective auto lenders. \u00a0If the lender chooses to finance your loan, an interest rate will be quoted to the dealer to finance the loan for you. \u00a0Once the vehicle purchase is complete, the dealer-arranged loan may then be sold to the lender. \u00a0At this point, the dealer is paid for the vehicle, while the lender assumes the loan, and collects monthly payments from you for the agreed upon length of the loan. \u00a0This combined sale and financing agreement is called a Retail Installment Sales Contract. \u00a0Often the dealer will make an undisclosed profit on the difference or spread between the rate quoted to you and the actual, lower rate at which the bank would extend credit. \u00a0A dealer-arranged finance transaction is also called Indirect Lending.<\/p>\n

Direct Loan<\/h2>\n

\"BankA direct\u00a0loan is where the consumer goes directly to a bank, credit union or finance company to apply for a loan. \u00a0Many times these lenders can “pre-approve” you, and quote an interest rate and term for the total amount you want to borrow. \u00a0The lender will give you a commitment letter that can be taken to the dealership to purchase the vehicle.\u00a0Once the dealer is paid for the vehicle, monthly payments will be made directly to the bank, credit union or finance company for the term of the loan. \u00a0The banks sometimes call this Direct Lending.<\/p>\n

Repossession<\/strong><\/h2>\n

\"CarWhether a consumer has arranged for a direct loan or a dealer-arranged loan, there are terms specified in the loan agreement which address default and the option for the lender to repossess the vehicle.\u00a0Whether a consumer falls behind on payments or not,<\/strong>\u00a0the lender must follow a number of rules before and after a vehicle is repossessed. \u00a0If any rules have been overlooked, the consumer may take legal action against the bank, credit union or finance company.<\/p>\n

Seek a Free Legal Evaluation<\/strong><\/h2>\n

\"AttorneysFlitter Milz is a nationally recognized consumer protection law firm that represents victims of auto finance fraud and repossession. Contact Us<\/strong><\/a> for a free evaluation of whether your consumer rights have been violated, whether or not you fell behind on payments.<\/strong><\/p>\n

 <\/p>\n

\"\"<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Cars, trucks, motorcycles, RVs or boats, they’re all expensive. \u00a0It’s unusual that these purchases are made in cash. \u00a0Whether buying a new or used vehicle, most people choose to finance the purchase and make specified payments over a designated period of time.\u00a0 Financing\u00a0can be arranged in two different ways.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[2,6],"tags":[49,44],"_links":{"self":[{"href":"https:\/\/www.consumerslaw.com\/blog\/wp-json\/wp\/v2\/posts\/2027"}],"collection":[{"href":"https:\/\/www.consumerslaw.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.consumerslaw.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.consumerslaw.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.consumerslaw.com\/blog\/wp-json\/wp\/v2\/comments?post=2027"}],"version-history":[{"count":3,"href":"https:\/\/www.consumerslaw.com\/blog\/wp-json\/wp\/v2\/posts\/2027\/revisions"}],"predecessor-version":[{"id":2080,"href":"https:\/\/www.consumerslaw.com\/blog\/wp-json\/wp\/v2\/posts\/2027\/revisions\/2080"}],"wp:attachment":[{"href":"https:\/\/www.consumerslaw.com\/blog\/wp-json\/wp\/v2\/media?parent=2027"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.consumerslaw.com\/blog\/wp-json\/wp\/v2\/categories?post=2027"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.consumerslaw.com\/blog\/wp-json\/wp\/v2\/tags?post=2027"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}