Dealership Sales Incentives and Other Helpful Auto Financing Tips

Ads promoting auto dealership sales incentives such as 0% financing, low-rate financing, or rebates can be enticing, but read the fine print before getting too excited.

Ads often sound like anyone could qualify and rates are good on just about any vehicle. Often this is not the case. It's not unusual for dealerships to use "bait and switch" tactics to get consumers in the door, only to find that what they thought was true, isn't.

Look for the letters "OAC." This acronym stands for "on approved credit." In reality, only about 25 percent to 30 percent of consumers qualify for 0 percent financing. You have to have what's considered the best credit score--typically700 or higher--to qualify for that special financing deal.

The fine print also might read, "Advertised vehicles may differ from vehicles shown," "0 percent available on all new brand ‘X' automobiles, excluding make ‘Y' automobiles," "Prices good through ‘a certain date'; subject to change without notice," or "Rebate good only if financing is done through dealership." These phrases mean quantities and styles are limited, sale dates can change at a moment’s notice, and you might be forced to finance through the dealership. If you decide to apply for an auto loan through the dealership, you may have to pay an application fee and pre-payment penalties.

Smart answers that help put you in the driver’s seat

At Tower, our goal is to help you make educated decisions about buying a new or used vehicle. We would like to help put you in the driver’s seat. Below are answers to commonly-asked questions to help guide you in finding and financing your next vehicle.

How can I find the best price on a new or used vehicle?
First, do your homework by shopping on the Web, visiting dealerships online, and reviewing car Web sites. Research the type of vehicle you want, including the make, model, body style and options before visiting a dealer or private seller.

Once, you’ve made your decision, visit helpful sites like Edmunds.com and consummerreports.org to find a fair asking price. You can also use the Chrome Carbook, a one-stop station for comparison pricing and detailed information for all makes, models and options found in Auto Loans.

While you’re there, you’ll find the resources of United Auto Buying Service (UBS). UBS is a money-saving service that offers no-haggle, pre-negotiated pricing on most foreign and domestic vehicles, dealer incentive money, discounted option pricing and more.

Another hassle-free way Tower offers to help you find the best deal on a used vehicle is with Enterprise Car Sales. We’ve teamed up with Enterprise to provide members a one-price, haggle-free buying experience.

What is the best way to negotiate with a dealership?
When you’ve found your vehicle, go to the dealership with the best deal. Know ahead of time what you’re willing to pay, whether or not you want an extended warranty or options, and most importantly, be prepared to negotiate. A fair price is usually 3 to 5 percent above the dealer’s invoice.

Once you’ve gotten the dealer’s best price, make sure any factory rebates are included as a line item. Then, double check the dealer’s price against your research. Revisit the dealership and, as a second negotiation, ask the dealer to refigure the deal with your trade-in, if applicable. Improve your bargaining power by going to Tower first to apply for a loan pre-approval .

How can I get the best financing deal?
The best way is understanding the financing deal itself. The person or dealer selling you the vehicle may give you biased advice.

Often your best deal could come from taking the dealer rebate and financing your vehicle through Tower. There is never an application fee or pre-payment penalty and since we charge simple interest, you can pay down your principle at a faster rate. Plus, Tower offers special auto rate promotions throughout the year.

How much can I qualify for?
Visit any Tower branch and together we’ll review your finances to determine an affordable monthly payment that works within your budget.

A Member Service Representative will show you financing options that include down payments, deductibility of the loan, total purchase price, finance charges and the loan term. Or, if you prefer, you can calculate your payment using Tower’s auto loan calculators and check our latest loan rates.