Line Up Financing Before Shopping

Seven out of 10 new cars and trucks are financed, and you can also finance the purchase of a used car. But to do it right, you must be prepared before and after you reach the car lot.

It's smart to get about three different loan quotes. If one seems especially low, verify that it's an actual offer to lend you money at that price and not just a gimmick to get you signed up before the real numbers appear.

You can get an auto loan from a bank, credit union or other financial institution. You can have these loans pre-approved before you ever hit the showroom (a major plus in most deals). These sources of financing will usually offer the lowest rates you'll find, and credit unions are generally lower than banks. Comparison loan shopping has gotten much easier because of the Internet. Most bricks-and-mortar banks and credit unions offer Web site auto loan quotes and applications.

The best way to buy and finance a car is to shop around for the loan first. Internet lenders have increased in recent years and often offer very good rates. They usually will approve you for a total amount to be financed before you go shopping, leaving you free to concentrate on price alone.

After you agree on the price of the vehicle and it is time to talk financing--you'll be in control of the situation. You can listen to the dealer's offer for the financing and compare it to the loan you already have pre-approved.