Why You Should Buy Your Next Vehicle Through a Car Dealer

A car dealer, or local auto sales, is a privately owned company that sells used or new cars in the local retail market, according to a dealer contract with its own sales division or an automaker. It may also carry various types of Certified Pre Owned cars. It employs vehicle salespeople to sell the cars it has in stock. But unlike an auto dealer that buys and sells in a uniform fashion, an independent car dealer has different car buying policies, different car selling techniques, and different types of outlets.

New car dealers have a fixed monthly payment for a new car; it could be a fixed or a floating rate. The monthly payments could either be in cash or in kind such as through instalments or by using trade-in equity. They also set the price range of their new cars. In most cases, new car dealers use the sticker price of the cars they want to offer as their guide to determining the cost of the car they will sell to the customer.

Nissan dealers Jacksonville NC buy their vehicles from finance companies before selling them to the end-user. Finance companies assign dealers to specific cars and create a financing package. The dealer then determines the monthly payments of this financing package and buys the vehicle using trade-in equity from the finance company. The finance company receives cash based on the difference between the trade-in price and the actual purchase price of the vehicle. Then the dealer deducts his wholesale fee from the monthly payments. Dealers may also decide not to charge a wholesale fee.

Nissans Greenville NC dealers buy their vehicles directly from the manufacturer, sometimes referred to as "direct manufacturing". Most major car manufacturers contract with independent financing companies that work under them to manufacture their vehicles. These dealers then own the entire production and sell them under their own label. There are many independent dealers with their own manufacturing plants. These dealers set their own purchase prices, and they negotiate with the manufacturer to ensure the highest possible purchase price with minimum risk to themselves.

Car dealers obtain financing for their vehicles in two ways: through finance companies like GMAC or Toyota Financial Exchange, or through banks like Wachovia or Bank of America. If they purchase their vehicle from finance companies they will receive a buy rate from the dealer's buy rate system. The buy rate is the wholesale price the dealer pays to the finance company. If the car dealer's purchase rate is lower than the buy rate, the dealer has to pay a percentage of the difference to the finance company to complete the transaction. When the finance companies make their profit, as they do on nearly all transactions, they pass some of this profit onto the consumers.

Car dealers also obtain financing for their vehicles from banks with the exception that they do not need to obtain their own financing through GMAC or Toyota Financial Exchange. Banks are able to offer significantly less money than GMAC or Toyota but are subject to the credit score restrictions of those lenders. In addition, dealers often have better interest rates when they finance through banks since they have little risk involved. These interest rate differences between the two types of financing makes buying a vehicle with one type of bank significantly more affordable than buying one with the other. This is another reason why it is so important to use an auto dealer that has been approved by the Better Business Bureau. Look for more facts about automotive at http://edition.cnn.com/US/wheels/links.html.

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