Buying a car is a large commitment.  It is expensive and it is a vital part of your life that needs to last you a long period of time.  So, despite the expense, it is important to find a car that is going to be dependable. 

Most people cannot pay straight cash for a new car.  This is where car finance helps simplify things, or at least tries to.  Even people who do have enough money saved to buy a car are unlikely to do so since it will completely deplete their savings.  Most people either lease a car or use a bank or credit union to help finance their purchase.  One of the few times outright purchasing a car is a smart idea is when the buyer has a poor credit rating.  When you are financing a car you are subject to interest rates.  If you have a poor credit rating you will have a high interest rate. 

The dealership you are purchasing from will often let you finance through them.  There are good and bad aspects of this method.  For one, it is extremely easy and fast.  You are already at the dealership so nothing is simpler than consolidating your debt into one location.  Dealerships can be bad to use when financing your car, however, because they are not forced to have competitive prices.  When you are financing your car through a bank you are getting good, competitive rates.  The dealerships will not have these and will often push “sales” onto you that will do more harm than good in the long run.

The most common way to finance your car is to go through a bank.  Going through a bank can be good because you are sure to get the competitive rates that you will miss at a dealership.  Also you will get personal attention and care, the bank will even tell you if the deal you are making is bad for your overall credit.  Also, going through your regular bank means that you are likely to get special offers on your banking in general.  For instance, many banks will add on free insurance to your car financing as a way to thank you for going through them.  The main problem with going through a bank is that it is not as convenient.  You cannot set up an account at night or on the weekend.  But, waiting an extra through days can save you a lot of money over the long term.

It is also possible to finance through an online source.  This can be dangerous though, look out for scams.  You will never actually meet your financer and may end up being cheated of money.

You should also be careful accepting help from a family member or friend.  Though you are going to get personal care and good, flexible rates, you are running the risk of ruining a relationship. 

Whoever you go through, make sure you pay attention to how long it will take to finance your car.