I was approved for 2.99% interest from the dealership and my local credit union. I have a savings account with my credit union.
1. Is it better to get loan from the credit union or the dealership finance companies?
2. If I choose the credit union for the loan and get into trouble making the payments, will they automatically take payments from the savings account?
Is the dealership offering cash back (rebates) in lieu of the 2.99% rate? If so, it might make more sense to go the CU route and grab the rebates (if any) offered for not using the dealership's financing.
Or, if you are like me, looking for a Hyundai Sonata, the only way to get a rebate is to finance with them (Hyundai Finance; $400.00 for recent graduate). So consider the rebates if there are any and what does it take to qualify for them.
Can't speak as to what the CU would do in you don't make payments, but be careful.. if you feel uneasy about being able to pay the money back you might need to rethink the purchase. Many people on this site are rebuilding from bad luck or poor decisions made, if you can avoid getting into a bad situation, that it would be the best gift you can give yourself!
Normally I would say a CU but Toyota gave DW the same rate and some extras when they found out she was pre-approved by our CU. I would try the CU first and see if you can use that to bargin with the dealer.
IMHO a CU is less forgiving on not making payments.