America Top 10

  • Home
  • Find A Top 10 List
  • News & Information
  • Our History
  • Contact Us

New Car Financing How-To’s

November 16, 2016 By Elizabeth Leave a Comment

Want to purchase a new car but don’t have the money for it? Or you probably can afford it but you’re thinking of other financing options? After all, you have other things to spend on and not just this, right? Either way, we all want the best deal that will work for us, so here are some tips on new car financing.

An Overwhelming Task

Buying a car is truly no simple decision that you make impulsively. There are so many factors to consider and so many things you have to do. From paying cash straight up, to buying a car on finance, there are also many options available out there that confuse the first time buyer. In addition, you should also be considering running costs. In fact, it’s probably the second most expensive thing you’ll buy after a home. So it’s important to make sure you get the best deal on financing.

Not An Investment

If it’s one thing people keep on forgetting about buying a car is that it is not an investment. In fact, investment wise, it’s the contrary.  This is because cars depreciate over time and use, not like homes. For this reason alone, we recommend that it’s not smart personal finance to pay interest on a car loan. What happens in most cases is that the car depreciates and the value of the car drops faster than you repay the loan.

Savings

Most of you might not agree that it’s a good idea to use your savings to finance for a car. There is, however, one situation where you should consider it. When interest rates are so low, it’s likely that your savings will not be earning much in a bank. So rather than keeping your savings while choosing to borrow at a higher rate of interest, you could use your savings instead to fund all or some of the costs. However, you should make sure that you have enough savings left over for an emergency after you have paid for your car.

A Personal Loan

Another alternative is to get a personal loan from a bank. Other sources of personal loans include a building society or a finance provider. Just remember that the possibility of borrowing will depend on your credit rating. Also, make sure that the loan is not secured against your home. Otherwise you will be putting your home at risk if you failed to keep up with repayments. What’s good about personal loans is that it can cover the whole cost of the car and it can charge a competitive fixed interest rate too.

Other Tips

  • You’re usually better off new car financing from a financial institution, not the car dealer.
  • Your monthly car payment should represent no more than 20% of your disposable income. This amount should cover not only your car payment, but also your insurance and fuel costs.
  • Long-term new car financing loans will definitely cost you a lot in interest over the long run. The ideal car loan term is anywhere from 3-5 years.
  • One of the biggest mistakes people make when buying a new car is forgetting to include the cost of auto financing in the total price.

 

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Random Fact

The Earth weighs around 6,588,000,000,000,000,000,000,000 tons.

  • Facebook
  • Google+
  • Twitter

Related Information

<?php echo Easy Wicking Tubs; ?>

Easy Wicking Tubs

June 18, 2019 By Elizabeth

<?php echo What is a Neurologist; ?>

What is a Neurologist

June 16, 2019 By Elizabeth

<?php echo Birdhouses from Recycled Material; ?>

Birdhouses from Recycled Material

June 14, 2019 By Elizabeth

<?php echo Rained In? Go to the Library!; ?>

Rained In? Go to the Library!

June 12, 2019 By Elizabeth

<?php echo Benefits to Brow Threading; ?>

Benefits to Brow Threading

June 9, 2019 By Elizabeth

About America Top 10

It is all thanks to you! We never envisioned when America Top 10 launched way back in 2011 that we would come this far this fast. And it is all thanks to you. You have made America Top 10 the successful resource it is for tens of thousands of people like you every single day.

And we cherish all the wise advice, suggestions, questions, and comments you send us every day even if we do not get a chance to get back with every single one. We take pride in helping people find trustworthy sources in their local areas and we hope to keep doing this for a very long time.

Recent Articles

  • Nerve Neuropathy
  • Easy Wicking Tubs
  • What is a Neurologist
  • Birdhouses from Recycled Material
  • Rained In? Go to the Library!

Search

Copyright © 2022 America Top 10. All Rights Reserved.