F&I (Dealer Finance and Insurance) is the car dealer's area of highest profit.

The dealer wants to sell you "F"—their financing. Why? Well, let's say the dealer's buy rate* is 8% and they convince you to pay 11% interest on your auto loan. Who gets the 3% difference? Not you!

And if you buy their financing, they can sell you "I"—credit life, accident and health insurance—again at a considerable profit. And while they're at it, how about extended service contracts, undercoating, an alarm system, etc., etc., etc.

It is not uncommon for the "business manager" (F&I salesperson) to be the highest paid salesperson at the dealership. Why? Because it is not uncommon for the F&I department to be the most profitable department at the dealership.

BEWARE! You shop for your car. Take the time to shop for your financing, insurance, and warranty as well.

*Buy Rate–the lowest rate the dealer can finance a vehicle for a credit-worthy customer.