Six ways to finance your car

The car you buy is likely going to be the second biggest purchase that you ever make in life. The one thing that you should understand before you buy your car is the finances that you will need to get you there. It’s a big purchase and you may not be able to land several thousand dollars on a car from the off, but that doesn’t mean that you can’t afford to have one. 

You should never wait until you fall in love with a new car before you consider the budget that you have. In fact, you should be shopping with the budget you have in mind from the beginning, as this will stop you from thinking about the cars beyond your price bracket. If you’re in the market to buy, take a look at these six ways that you can finance your new car.

  • Check your score. Before you head to the dealership, log in and check your credit score. Not only will it help to know whether you could get one of those buy here pay here deals, it will help you to understand if you will be rejected for credit or not. Your credit score impacts your car loan type and will tell you whether you will be paying a ton of interest or not!
  • Keep your loan short. You want the car to be yours as soon as possible, and the sooner you pay for the car, the better! The longer it takes you to pay it off, the more interest you have to consider paying, too. Make sure that you are happy with the loan terms when you sign off on the car, and you won’t have so much interest to pay!
  • Add a huge deposit. If you can afford to land a good-sized deposit on your car, go for it. You want to know that you have the money to afford the loan you go for, so if you know you can part-pay for the car and get the rest of it on finance, you will save yourself a lot of money!
  • Cash, cash, cash. If you take finance for the bulk of the car, see if you can cover the car registration and taxes into cash. If you add fees to your finance you’re adding to your loan repayment without upping the worth of the car.
  • Always research deals. You can find an excellent deal with one dealership, but if you didn’t shop around you wouldn’t be aware if there were better deals out there or not. Make sure that you are checking your options out with other people and you can ensure you are getting a good deal. You may even be able to bring your current dealer’s price down.
  • Get financial advice. Always get some financial loan advice before you get your new car – just in case you could have saved some cash on your newly financed car! This is also going to stop you from being scammed, too.

Photo Credit: BMW

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