Auto financing refers to a loan that is specifically designed for purchasing an automobile. This type of financing allows individuals to pay off their car over time, rather than having to come up with the full cost of the vehicle all at once. Auto financing can be obtained through various sources such as banks or credit unions, and typically involves a down payment followed by monthly installments until the loan is paid off in full. This option provides individuals with more flexibility when it comes to purchasing a car, allowing them to drive away in their new vehicle without having to save up for years beforehand.