5 Ways to Save Money on Financing a Car
Buying a car is one of the most significant purchases you will make, making it crucial to know your way around used car finances. So when you’re financing a car in Adelaide, you’ll want to be aware of these ways to save money.
Used Car Finances Advice
1. Improve Your Credit Score
Before you start looking for your car, give your credit score some attention. Lenders look at your credit score to see your history of paying off loans on time. If you’ve been struggling to keep up with bills recently, it may not be the time to add another financial commitment.
No worries, though: steps like consolidating your debt, paying your credit bill on time each month, and lowering your credit card limit will improve your score.
2. Research the Market
Market conditions will affect the price of any vehicle. For instance, the shortage of used cars due to the pandemic created a price surge. As market conditions are returning to normal, used car prices are heading back to pre-pandemic price points. This is excellent news if you are looking for a used car!
Other factors to consider when looking for a used vehicle are more minor details like the colour and add-on features. These variations could amount to significant changes in price. Knowing the economic conditions will help you secure a financing deal that reflects your car’s true market value.
3. Keep Your Loan Term Short
Car financing loans work the same way as other loans: The longer the loan term is, the higher your repayments will be. To save money on financing your used car, keep your loan term as short as possible. Although this may sound daunting, remember that a car is a depreciating asset. The money you pay in interest is money you will not get back. Start by putting as much into your down payment as you can afford, which should be at least 20%.
4. Use a Vehicle Centre’s Connections
It’s worth your time to explore lender options on your own, but don’t discount the financial benefits from a vehicle centre. They have relationships with multiple lenders and can leverage their connections to secure you a better deal. You may get access to a more flexible loan offer than you could get on your own, and you won’t have to take care of all the arrangements.
5. Look Into Green Loans
Australian financial lenders offer incentives to encourage buyers to select environmentally friendly alternatives. For example, green car loans give buyers a reduced interest rate on purchases of new and used eco-friendly vehicles. However, vehicles must meet specific criteria, depending on the lender.
Save money on your used car by implementing these helpful financing tips. When you spend a few months improving your credit score and researching the market, you can approach lenders with confidence. Maintaining a short loan term, leveraging vehicle centre’s connections, and considering green loans are also strategies worth employing. Adelaide Vehicle Centre
Sources used:
https://www.cleanenergyregulator.gov.au/ERF
https://www.carsales.com.au/editorial/details/how-to-save-money-on-car-finance-133699/
https://moneysmart.gov.au/managing-debt/credit-repair
https://www.drive.com.au/news/used-car-bubble-bursts-australia-trade-in-prices/