We've looked at financing your car through the dealer and via in house financing. Now we're going to take a quick look at some other ways to finance. The general rule of thumb when borrowing money is to get it from your dad for no interest. Of course I'm joking; borrowing money from family can be very stressful for everyone, so the real best choice is to get it from your bank or credit union.

Your own personal financial institution already knows you and has a vested interest in keeping your business. Sure it's nice that you have a checking and savings account with them but they'll like you even more if you start paying them some delicious interest. Your bank or credit union may offer special plans for their customers. For instance I make my own car payment via direct deposit, twice a month, with the money coming out on my payday. I'm happy because my payment doesn't take one big bit out of my one paychecks and my credit union is happy because they're guaranteed timely payment. My memory is a bit fuzzy but I believe they offered me a lower interest rate as an incentive for allowing the direct deposit.

Often you can also get a discount on your interest rate for being a customer, like the plan JPMorgan Chase Bank has now where Chase checking customers qualify for up to half a percent off. Half a percent may not sound like much but it can add up over the life of your loan, especially if you are buying a new, expensive car and financing it for a long time.

Before I go any further you should know that I am strongly biased towards credit unions. That's because credit unions tend to charge lower fees and are more consumer and community oriented than banks. My own credit union has gone to great lengths to assist me when I have had problems.

Credit unions often offer better rates than banks. Right now Navy Federal, one of the largest credit unions in the world, is offering 5.25% on a 37 to 72 month new car purchase loan. JPMorgan Chase Bank is offering 6.24% to 7.35% for the same length and type of loan.

Meanwhile the AFTRA/SAG Credit Union is offering 5.95% on new car loans up to 84 months. That's if you finance the entire cost of the car. If you put down 20% on the car you qualify for 5.45%. Bank of America is offering 5.49% for up to 60 months and 6.39% for 61 - 72 Months.

When we look at the above numbers we see that banks can sometimes beat credit union prices, but not always. So what do you do if you have a bank and don't want to use a credit union? You can try asking your bank if they'll match the rate you can get at the credit union. You'd be surprised what you can get if you only ask for it.

I need to mention that the rates listed above are the optimal rates, offered to those with the best credit scores. The actual rate you're offered may be vastly different, depending on what sort of credit history you have.

Next up we'll look at one last financing resource.