There is no question that today’s economy could be doing better. However, even in this slump, financing a car probably isn’t quite as hard as you may think. In some ways, car dealers are tightening their purse strings and are more careful about lending money than they were just a few years ago. At the same time, though, their lower sales volume gives them more incentive to help people buy new cars.

But that doesn’t mean that automobile dealerships are the only place to go for financing a car. Big banks are actually not one of the best sources because of the changes they have made. On the other hand, credit unions, regional bank and other local lending institutions are all potential sources for getting car loans.

The good news about the bad economy is that it makes it a buyer’s market. Car dealers are offering various incentives and rebates to help move the inventory off their lots. Some of these incentives include low interest rates, keeping your payments lower, and reducing the overall amount you will spend over the life of your loan.

There is a catch, however. The best deals are only available to those customers with the best credit. Therefore, if you are financing a car, you should check into your credit report and correct any mistakes that may be there. Also, if you haven’t been doing so, start paying all of your bills on time. The longer you do this, the more your credit score will go up.

But don’t just take the best terms you can get at the first dealer you go to. The key is to find the best price on a car first, then go to other dealerships to get the best price and terms. See what they each offer and crunch the numbers to see which ones are best. But don’t stop there! Once you have a firm offer from one dealership, go back to a different dealership and see if they can beat the offer. Remember, they are interested in selling vehicles, and may be willing to go even lower than their previous best offer if they’re afraid you’re going to buy from a competitor.

Now there is another potential trap here, so be careful. You are not only comparing the prices of cars, you are also comparing the terms of the financing. One of the dirty little secrets of car sales is that a large portion of their profits are made on the interest rates they charge. Remember, you do not have to get a car loan through the dealership. You can go to a bank or credit union, and will usually get better rates. However, you also have to take into account any special dealer incentives that good skew the numbers back into their favor.

Another thing you can do when financing a car is to go online to compare offers from various lenders. This is convenient because instead of you going out to visit each potential lender, they come to visit you, although they do it virtually.