Car Buying Made Easy: How to Find a Great Car in No Time
Car Buying Made Easy: How to Find a Great Car in No Time
Posted on June 5, 2023
Are you interested in buying a car in Cayuga? Auto loan rates in Canada are really low (hovering around the 3.9% range at the time of publishing). While many variables have to be taken into account before you can sign on the dotted line and take possession of your car, the overall picture is a positive one.
Let’s simplify that even further. We asked our Cayuga auto loans team to list a few ways you can save money when buying a car in Cayuga.
New or Used?
Have you considered buying a used car or is your heart set on a brand new car? There is no denying the appeal of buying a brand new car but you are going to take a bit of a financial hit.
Depreciation on new cars ranges from 10%-20% in the first year. If the car was $50,000 and the depreciation rate was 20% then after 1 year the car would only be worth $40,000!
We are using round numbers for the sake of easy calculation but depreciation varies by vehicle.
When you buy a used car, it will depreciate over time but not as quickly as a new car.
Accessing Auto Loans
The number of auto loan providers has spiked in recent years, a little over 10 years ago you had maybe a handful of lenders to choose from but now there are hundreds of them.
Some lenders specialize in subprime or consumers with credit challenges while the majority of lenders tend to focus on prime or consumers that fall in between prime and subprime.
Financial Snapshot
To determine what type of Cayuga auto loan you can secure, you will need to take a look at your credit report. There is no cost to access your credit report.
If there are errors inside the report then you can have them corrected. Take this process seriously, errors can bring your credit score down which makes it harder to borrow money at competitive rates.
Use Equifax Consumer Credit Report Update and TransUnion credit investigation request to have errors corrected.
Auto lenders are going to look at your credit score but also how long you had the accounts. Having a well-established payment track record of 2 years or greater will help increase your chances of getting a prime auto loan.
Income Sources
There are people with fantastic credit scores who are unable to get a car loan in Canada.
The reason these individuals are not able to get the financing comes down to a lack of verifiable income. Individuals who have seasonal jobs or jobs where there is a considerable amount of risk i.e., farming or working offshore.
Individuals who are self-employed or entrepreneurs have to prepare financial documents that show their income and expenses. One simple way to satisfy this requirement is to bring along income tax notice of assessments and banking statements for the last 3 months.
This paperwork may seem like a major hassle but imagine if you were the lender. Would you lend money to someone who has a terrible payment track record and no way of proving they can afford to repay the loan?
Lenders are eager to lend money to customers that are responsible, you just need to have all of the paperwork in place.
Picking the Right Car
After you have established whether you qualify for an auto loan and the maximum amount, you can begin scheduling test drives. There is no experience like buying a car, the car you do pick is going to be with you for quite some time to come so you need to pick something you love.
When you’re ready for a car lease or loan, get in touch with the Cayuga auto loan experts at Northway Ford for great deals on auto finance.
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