auto finance

Auto Financing Through Capital One

What is Auto Finance?

auto finance

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Auto finance, also known as car finance, points towards the number of financial aid available for customers to buy a car with any possible arrangement apart for a full cash payment.

The provision of auto finance provided by banks and certain financial institutions allows clients to pay dealers or manufacturers, even though they don’t have the required amount of money. In other words, auto finance allows the customer to get sufficient aid in buying a car by borrowing the money through loan etc. so that the seller can be paid.

Capital One Auto Finance:

auto finance

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A no. of banks and financial institutions provide provisions for good and consumer satisfaction in auto finance. Capital One is one of them. Going by stats, Capital One is ranked 11th on the list of the largest banks in the United States in terms of assets. The bank has seven branches, which  include 30 cafe-style locations along with 2,000 ATMs. It holds the 101st ranking of Fortune 500,  17th positions at Fortune’s 100 Best Companies to work for the list and carries out business in the United States, Canada and the United Kingdom.

In the field of auto finance, Capital One is considered the fourth-biggest auto lender with a considerably better percentage of market share. Moreover, auto financing is widely used by both the public and business members.

According to the Federal Trade Commission (FTC) guidelines, which include America’s consumer protection agency, consumers and businesses have two options in auto financing:

  1. Direct Lending
  2. Dealership Financing

Capital One like any other bank and financial institution follows these two steps:

Direct lending:

auto finance

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Direct lending in Capital One is a process in which the consumer or the purchaser gets a direct loan from the lender bank. The buyer agrees to clear the loan over a certain period, determined upon a mutual agreement, with additional interest and financial charges.

Once the customer enters a contract with a particular dealership to purchase a car, he or she acts on the aid received through the loan agreement from the lender, paying him later.

The FTC again has the perfect advice and suggestion for eager consumers to shop around and ask lenders about their credit terms before one agrees to purchase a specific automobile.

With direct lending, customers will know what credit terms lenders are present while obtaining financing before purchasing the car, and customers will know about their exact rates and also a few other terms while they start shopping.

With shopping correct lending, the mortgage kept as security is to be chosen wisely.

Dealership Financing:

auto finance

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Dealership financing refers to financing done through sellers, i.e. dealers or dealerships. Here the contract is between the dealer and the customer, wherein one buys a car and agrees to pay the amount along with a financial charge, over a set of predetermined period

Dealership financing further has three main advantages:

Convenience: 

auto finance

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Dealers showcase a number of cars in addition to the financing done at one single place. To satisfy customers, they also have extended hours in the evening and open Weekend

Choice: 

auto finance

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Dealers have healthy relationships with a great number of banks and finance companies, indicating they help customers with an array of choices.

Special Programs: 

auto finance

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Dealers also offer certain programs directly sponsored by the manufacturer itself, to buyers, mostly showcasing low interest schemes along with other attractive features. These programs have a drawback too as they  appeal only to some particular vehicles and require large down payments, short time periods etc. In order to avail these programs the consumers need to have strong credit assurance.