Just make sure up front, in writing that there is no prepayment penalty. We have done this a couple of times.

Don't let the dealer sell you life insurance that will pay off the car loan in the event of your demise...unless you want it, that is. It's ridiculously expensive in my experience. I've financed 1 Honda and the finance guy pushed and pushed and pushed me to buy it.

It would depend on the reputation of the dealer. There are some private dealers in town and I would not buy a car from them much less finance through them. Are they just used car lots or are they dealers like Nissan, Toyota, etc.?

I too have financed through dealer..
I agree with Patser and Terilyn...both make great points.

And to get that 0.0% rate, you need to have absolutely perfect credit. The cut-off credit score for tat rate is pretty high. Know what your credit score is before you go to a dealer.

I have... both good and bad experiences. When we bought my VW Rabbit in 2007, my credit union was offering 4% and the dealership said they could not beat that. Our credit union car loans are also better because we can pay extra each month and reduce the amount we pay in interest (more like a house loan than the traditional car loans where you pay all the interest upfront, make sense???).

Get EVERYTHING in writing, especially the 0.0% rate. i cannot imagine what rules they offer with those rate but I am sure there is something about it getting jacked up to some horrid rate if there is ever a problem. If you go that route, I would recommend having it directly debited from your account a few days BEFORE the due date so if they ever try to claim it wasn't paid on time (reason to jack the rate up), you can show that not only was it paid on time, it was paid early. Also, find out what happens if the due date falls on a weekend/holiday (only guessing they would try to jack it up then, too). Having all of our accounts through the credit union helps alleviate all kinds of potential problems. They cannot say the transfer didn't go through on time since they handle both ends of the transfer, etc.

we had a 5 year 0% on DH's truck through Chevrolet. No problems what so ever. There was no penalty for early pay either. But we chose not to do that anyway. It was a 0%! LOL. I financed my car a while ago through Ford. 2.99% . No penalty for early payoff. I made extra monthly payments and paid it off early. Not a problem to be had.

I've financed with the dealer to get better interest rates. It was with Mazda, and also with Hyundai and Ford. The most recent vehicle we purchased, the dealer got a better deal for us through Chase. I had a pre-approved rate of 3.9% from my credit union, but Chase had 2.79%. I wouldn't finance through a private dealer, but would have no qualms about financing through the corporate finance.

I'm proud to say I've only financed one vehicle in my life. My first new truck and I got a loan from the bank (the dealer was pulling stunts) for 9 months and paid it off in 5 or 6. I probably should have waited a little while and paid cash for it, but was anxious to get it. Ever since, I've paid cash for every vehicle, new and used.

As said, your credit usually needs to be pristine to qualify so be sure to check it and of course, get it in writing!

I note you're only financing about 1/4. How long would it take to pay for the whole thing? Depending on the vehicle issues, I'm assuming repair costs would be outrageous? Otherwise repair might still be a good option, or you could just buy a beater to last a while.

Couple cautions are to get it in writing before hand and read it thoroughly, at least a couple times. Read it with a skeptical eye, don't assume anything. Look at it as how can they screw me, for things like upping the rate, penalties and the like. See what happens if you pay late. Maybe you never will but it could happen. One late payment can cost hundreds or more in a bad contract.

Another thing to watch for is the infamous "Ford add-on" as it's known around here. Ford dealers seem to be the worst, but others do it too. They sell you a vehicle, tie you up a few days "getting it ready", etc, and then when you go to pick it up, won't sell it to you at the agreed price or they change the terms (finance through them, different down payment, different interest rate, etc). "They made a mistake" is the usual line and they can't sell it to you for that. Won't give you a signed contract up front - they "hold the paperwork" until you pick it up. They tried to force my cousin to finance through them or add $1200 to the price and would be required to wait a minimum of a year to pay it off and there'd be a charge to do it. My cousin (an avid Ford loyalist) told them to pound sand and left. They called in a few days to try to get him to do it, he wouldn't, and they wouldn't budge so he told them to leave it sit on the lot and he went and bought a Subaru. Shortly after, my vet got hit for $1500 but didn't want to hassle with dealing with more car jockeys so she paid it. And those are just two examples.

Watch for last second add-ons, substituting a different vehicle and other price increases. As vala55 pointed out, much depends on the dealer so if they're slimy, beware, if they're reputable, things could go well. I wouldn't automatically eliminate a dealer finance if I was forced to finance.

I just recently bought a Nissan Altima.
I had two options: o financing for 60 months, vs 1 1/2 percent with Nissan, and I got a better deal with the last option, with Nissan financing. I had help from a friend, who knows, and I am pleased with my deal.

We've financed and leased cars through the dealer and have never had a single problem - no add ons, no insurance pitches, no change of terms. Each time we checked first to see if we could get a better rate elsewhere. We also find out what the price of the car would be if we bought it outright. The dealer often gets a bonus or some type of credit from the manufacturer if he can do the financing. We ask them to split it with us or to lower the price of the car accordingly.

Depending on what deal they offer us we either finance or buy the car outright. The leased vehicles are company cars so we don't pay our of pocket but we still try to get the best deal possible.