You are on the eve of purchasing a new vehicle, and the light bulb goes off in your head as you are considering your financial options—why don’t I use my credit card to finance my next car.  In certain situations, there are a lot of benefits of purchasing a car with a credit card. Here is everything you should be aware of and what potential benefits you may reap if you go this route.

The Hardest Task of All: Finding A Dealership That Will Take a Credit Card

Most dealerships won’t accept a credit card for a purchase. The reason for this sit that they are no different from other merchants who have to pay interchange fees on credit card purchases according to the article “Should You Buy A Car With A Credit Card?” These fees can range from 1 to 4 percent, though the average hovers around 2 percent. Say you end up charging a $30,000 car purchase, the dealership will end up owing $600 in processing costs.

Why You May Not Want to Charge the Purchase           

Now that you have found a dealership that will accept a credit card, you should stop and really consider if this is the best option for you. If you are considering this method because you are unable to qualify for a normal auto loan, you should not do it according to the article “Can I Buy A Car With A Credit Card?” The reason being is that credit cards usually have an APR in the 14 to 28 percent range, which means in the long term, you are going to be paying massive amounts of interest.

This may affect other parts of your financial life as well. If you are looking to purchase a new home in the coming months, then it is not the best idea to charge the car to your credit card. This will increase your debt to available credit ratio which will affect your credit score negatively.

I Am Not Changing My Mind, Tell Me the Benefits

If you are still set on making the purchase with your credit card, here are some of the potential benefits that you can actually get by going this route. If you can get into a 0% APR credit card, and you are sure you can pay off the purchase when this period ends, then you can save a ton of money by not having to pay large amounts of interest. Of course, this is only beneficial if you are sure you can pay it off in time, and, that you won’t get a better deal from the automaker. “A zero percent offer for five years from an automaker is a much better deal than a zero-percent introductory rate on your Visa, Mastercard, or Amex card that only lasts a year, then goes to an expensive interest rate,” according to U.S. News.

Hunting down the righty credit card will be your next step. Your first stop should be researching auto credit cards according to Nerd Wallet. A lot of the big-name automakers offer branded credit cards that offer a lot of rewards. Make sure you do your research thoroughly to determine which credit card would be best for this purchase and that you have enough cash to pay it off in a timely manner.