There are many different types of loans, from mortgages to personal loans to auto loans. However, there are also different subcategories that exist within each of these types of financing.
For example, there are many different types of car loans. There are your basic, "traditional" auto loans, bad credit auto loans, no credit auto loans, car loans after bankruptcy, and more. Another type of car loan that people do not know a lot about is the subvented loan.
Subvented auto loans are not the most common thing in the world, which is probably why you may not have heard of them. Subvented loans are where manufacturers reduce the cost of financing, usually through the decrease of the interest rate.
Most of the major automakers have captive finance arms that operate as lenders and make loans for customers. Occasionally, they will subvent the cost of borrowing from them. There are several reasons why they may do so, such as to move more models that aren't selling well.
Some captive lenders run subvented financing programs for special finance customers. This helps them get customers they wouldn't otherwise be able to work with, and it could mean you land a subvented interest rate that would be much lower than what you could typically qualify for.
Not all captives operate this way, but getting approved for subvented auto financing could help you save a lot of money if you are able to qualify for a low interest rate. However, it should be noted that there is a small catch.
Subvented loans are typically very short loans. A shorter loan term means a higher monthly payment amount, but keep in mind that it still means big savings overall thanks to lower interest charges over the life of the loan.
If you are dealing with credit issues, it can be tough to find a dealership that can work with your situation. Not all dealers are willing to accommodate consumers with bad credit, but Smart Car Loan can help you find one that does. For free, we can match you with a dealership in your area that specializes in helping people with bad credit. All you need to do to get started is complete our simple and secure online application.