Fast Facts

This section provides quick answers to questions relating to the auto financing industry, including those about competition in the marketplace, how consumers research their options, and the scope of options available to all consumers.

  • Today, the majority of auto financing is done on site at the dealership. Last year alone, more than 24 million auto financing transactions occurred at dealerships. Dealing in such large volume allows dealers to offer competitive rates and access to multiple financing sources.
  • Virtually all automotive dealerships offer the convenience of one-stop shopping through on-site financing offerings that assist consumers in securing financing. Most dealerships work with at least five to ten different banks or finance companies so that they can offer competitive deals to their customers.
  • Because of a dealer’s access to multiple financing sources, consumers with all kinds of credit histories, including buyers considered to be high-risk, can secure competitive deals. Dealers have provided financing to millions of consumers with credit challenges.
  • Customers can and do shop around for the best auto financing deals, demonstrating the high degree of competition in this marketplace.
  • There are multiple sources of financing for automobile purchases beyond dealerships and traditional banks. These include credit unions, savings banks, loans from stock brokerage firms and home equity loans. This has created a highly competitive marketplace and lower rates for all consumers.
  • Most dealers disclose to consumers that the finance rate they are offered may be negotiable and that the dealership may receive a portion of the finance charge for extending credit. Additionally, to help consumers make informed decisions, the National Automobile Dealers Association (NADA) and American Financial Services Association (AFSA), in cooperation with the Federal Trade Commission, created a brochure called “Understanding Vehicle Financing” that walks consumers through the auto financing process and encourages them to shop around to find the best deal.
  • The current auto financing system employs hundreds of thousands of people, generating tremendous state and federal tax revenue.


Recognizing the need for consumer education, automotive industry leaders have formed AWARE (Americans Well-informed on Automobile Retailing Economics), a collaborative industry effort to provide consumers with information, tools, and other resources to better understand the auto financing system.