If you are considering taking out an auto loan, the first place you will likely look is at the dealership for the car you are considering. Dealership auto loans are convenient because you can take care of the paper work and leave with the car in one move, rather that getting the money from another institution, settling the paper work there and then going to the dealership separately.

Unfortunately, dealership auto loans are usually not very competitive, and you have the added pressure of dealing with a salesman whose entire job is to get as much money out of you as possible. In addition, many loans from dealerships are front-loaded loans, which means you will pay more interest early on. So, if you plan on paying off your auto loan quickly, this is not the best deal you can find.
An Auto Loan from a Bank/Credit Union

Another option is to go to your bank or credit union (if you are a member). They usually have more competitive rates for auto loans, and are there for you, rather than for the car. Representatives also tend to have knowledge on the subject, and can advise you regarding the amount you are paying. Finally, auto loans from these financial institutions are usually simple interest loans, spreading the interest out evenly over the course of the loan.
Using a Home Equity Loan As an Auto Loan

If you are a home owner, you can take out a home equity loan, and use the money to buy your car. Tax deductions can be made on some of the interest you pay, and you can usually get very competitive rates. You are, however, putting your house on the line should you fail to pay back your loan. So, make sure you are confident in your financial situation before you take this risk.
Online Auto Loan Options

Online you can find many financial institutions that will offer you an auto loan. The most important factor if you choose this option is to remember to check into the company you are using. There are many scams online, so check the Better Business Bureau to make sure the company is legitimate. While there is little to no personal contact, benefits of online financial institutions include that they are quick and easy, as well as competitive.
Personal Loans as Auto Loans

One final option for your auto loan is to borrow the money from a friend. You benefit from being able to negotiate a deal and not having to deal with some impersonal stranger at a company. You usually also get very competitive interest rates, or even no interest at all. However, this is also a risky choice. Borrowing money can be very detrimental to relationships, especially if you have trouble paying it back.

If you are at all concerned that you will not be able to meet the payments, you should not get involved with such a loan. You will not only be in debt with someone, you might just ruin your friendship with them.

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