Conventional wisdom says making a car loan through the bank or credit union is cheapest, but that may not be the case.

Four dealers were randomly selected to price a four-year car loan. The hypothetical buyer was willing to put down $1,000 on a 1998 Chevrolet Cavalier, the luxury four-door model, with a manufacturers recommended price of $14,250. We asked the dealers to presume the buyer had average credit.

The dealer rates in those cities were compared to area bank rates for the week ending June 12 as published by Bankrate.com.

Interest Rate

Offered by Dealer

(and resulting interest)

Interest Rate

Offered by Banks

(and resulting interest)

Herndon Chevrolet

Lexington, S.C.

7.25% – 8.75% 8.92% – 9.43%
($2,054 – $2,502) ($2,553 – $2,707)
Alley Chevrolet

North Seattle, Wash.

7.75% 7.80% – 10.08%
($2,202) ($2,217 – $2,904)
Bill Wink Chevrolet

Dearborn, Mich.

7.25% – 9.25% 8.00% – 9.25%
($2,054 – $2,652) ($2,277 – $2,652)
Roger Dean Chevrolet

West Palm Beach, Fla.

7.90% – 8.90% 7.75% – 10.50%
($2,247 – $2,547) ($2,202 – $3,034)

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