Indirect lending is the process of lending money to someone that you don't have a direct relationship with. An example of direct lending is when a bank lends money to a customer - because there is a direct relationship between the bank and its customer. However, indirect lending is through third-parties where there is no relationship between the lender and borrower. That means if you are looking for a car loan via indirect lending, you won't be borrowing money from a borrower that you are connected with. Lending tree is a good example of indirect lending, because you are borrowing money from total strangers that you don't know - and have no connection to you. Lending tree loans are funded by individual investors that put up their own money - to lend to others - that they have no relationship with. One final point about your car loan, you should research which type of lending (direct or indirect) can give you a better interest rate.