Car Loans Financing – New Car Vs Used Car

Nowadays, cars become a must thing for everyone to have at least one. By having a car, it helps us to move around and not too much depend on public transport. It can help us in all our daily activities from going to work, buying groceries or even to hospital/clinics whenever there is an emergency. But having a car is not as easy as what most of us think, we need to plan carefully our budget constraint, car type, maintenance cost, and after sales services. Beside this, there are a lot more factors that we need to consider before deciding on buying car.

If you don’t have enough cash on hand to buy car on cash basis, you don’t have to worry too much as there are lots of dealership or lending institution out there such as a bank or credit union already have programmes that can suit your financing need. It is a good advice for you to get your financing plan ahead of time before you walk in to the showroom to negotiate with the price tag on car. The foundation is same like all the business transaction, buying and selling always involving a negotiating skill. If you know how to negotiate your chances to get a lower price on car is always there for you. So, the reason why we ask you to come out with a proper financing plan is to increase your negotiation power so that you’ll be able to get more attractive deal from the dealer. It is true, that most of the dealer already has an arrangement with a bank for financing, but again having cash in hand may give you an advantage.

When you already qualifying for used auto loan, you will be given certain form to fill out and the lenders will start to conduct the usual basic credit check on you. They will let you know how much you can borrow and a set of monthly repayment for you to choose from, base on your preference. Then, now you are ready to doing shopping. Once you have found the used car you want, being inform you are already approved for the loan, the car detail will be sent to the lender who then will pay the car cost to the lender. You should aware that most of the time, bad credit auto loans are more expensive in terms of interest rates, but still offer lending options for those trying to buy a used car on credit basis.

Buying a new car is a big investment as it involve a huge sum of money, but luckily enough in car loans, especially new car loans most lenders are ready to offer you a longer time to pay the car loans. Lenders are willing to offer a longer period base on the facts that the cars is new and will lasting longer and performing better compare to a used cars. Nowadays, lenders are become more creative and you shouldn’t be surprise as some of lenders are even offering you as much as 9 years repayment period on new car loans.

Just for your knowledge, car loans are secured against the car. The more valuable the car, then the lenders will offer you more money so that you will be able to buy the car. In addition, in most case interest rates on new car loans are always lower than a used car loan. And some dealership are even offering new car loans with little or zero interest at all in some special package which normally relates to your credit score and also the repayment period on the car cost.

Auto industry is a fast growing industry and every year the car loan program is becoming more and more attractive and flexible as the lenders are becoming more creative and they always come out with a new programme that can suit almost everyone financing need. Just remember before you are deciding on whether to buy a new car or a used car, you should aware the pros and the cons of your decision.