Car buying tips for Canadians
Car buying tips for Canadians
Posted on May 25, 2022
Canadians who want to buy a car should follow the suggestions we are providing, or you could end up paying more than necessary.
As well, something that you should work out is how much you can comfortably afford to spend on a new car, most Canadians are not able to pay for a new car in one lump sum, so they need financing.
Auto financing in 2022
The pandemic has caused a massive shift in the world of finance. The Bank of Canada kept interest rates artificially low, so the economy would not collapse.
While interest rates on car loans are low, they are climbing every quarter as the Bank of Canada tries to slow the impact of inflation.
To save money, you need to move fast or end up paying more than necessary.
Lenders are aware of these rising interest rates, so they are modifying their underwriting requirements. During the pandemic, you could have secured a car loan with a 620-credit score, but those requirements have changed.
If you are having credit issues, you need to start working on your credit issues so you can secure the best possible financing terms.
Start the process by signing up with the Credit Karma app; this gives you access to your Equifax credit report. After you have access to the report, you should note whether there are accounts that are past due or in collections.
Then, you must do everything you can to bring those accounts up to date.
This may take a few months, but it will be worth the effort when your credit score begins to improve.
Importance of having a reliable source of income
While credit is important, you also need to have a reliable source of income that can be verified.
Lenders will not approve a car loan if your debts exceed forty percent of your gross income; if you earn $10,000 per month, then you could not be able to spend more than $4,000 per month on all of your debts, including the new car loan.
If you do not have a budget, you should create one; it is easy to make and helps you keep track of your finances.
Securing the best car loans
We mentioned that you need to move fast in order to secure the best possible Glen Abbey car loan terms, but you cannot do it alone.
One of the biggest mistakes consumers make is trying to get a car loan online.
There are websites that all claim they have the most competitive car loans, but sadly these websites cannot compete with the loans that you could secure by going through a local car dealership.
These dealerships are able to get you approved for a car loan, even if you are facing credit issues.
The dealership has credit experts on site that will show you the steps that must be taken to boost your credit score. Do yourself a favor and contact the dealership as soon as possible.
You can lock in the most preferential terms and drive home in a new car; if you wait too long, interest rates could rise, pricing you out of the market.
When you’re ready for a car lease or loan, get in touch with the Glen Abbey auto loan experts at Northway Ford for great deals on auto finance.