Dear Terry,

I have received several offers from a certain credit card company for a new car loan and the letters say I’m pre-approved. I am currently in the market for a new car and was wondering whether it is a good idea to apply for an account this way or go to the dealer and let them find me a finance company. I don’t want to lower my credit score by applying for new credit.


Dear Gladysmaria,

While not endorsing any specific lender, it’s always better to go shopping for a new car with your financing already lined up. The dealer gets a commission for setting you up with a loan and the interest rate may not be as good as you can get on your own. Check with your local bank or credit union to see what kind of terms they offer. You can also use Bankrate’s online service to

compare auto loan rates. Also, keep in mind that if you make several auto loan inquiries in a short period of time it will be viewed as a single inquiry and won’t damage your credit score.

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