When the time comes to buy a new-to-you vehicle, you might wonder whether to go for a new or used car. For many Canadians, a used car often makes more financial sense due to its lower sticker price, translating to more affordable monthly payments.
Beyond choosing a used car, there are several other factors to consider. Educate yourself on everything related to used cars in Canada to make a wise investment.
At Deal For Wheels, we strive to make the process smooth and ensure you get everything you want, including excellent used car interest rates. Browse through our comprehensive guide for buying a used car in Canada, answering all your top questions.
Start By Setting A Budget:
Regardless of the vehicle type, starting with a budget is essential. It ensures that monthly payments are affordable. Create a household budget listing all your expenses and income to determine what you can afford. Use our handy used-car loan calculator for clarity, factoring in your down payment, interest, and taxes to show your monthly installments.
Financial experts suggest spending 10% or less of your gross monthly income on car payments. This prevents the car payment from consuming too much of your finances.
Trade-In Options:
If you don’t have a down payment, consider a trade-in vehicle. The vehicle you’re currently driving may still hold value, which can be applied to your new purchase. The trade-in value depends on the vehicle’s make, model, year, condition, and any upgrades. Even if it’s only worth a few hundred dollars, it’s still money towards the purchase.
Our car loan calculator allows you to add in trade-in value, making the calculations for you.
Apply For A Used Car Loan:
Applying for a car loan is the next step. It’s beneficial to apply before finding the perfect vehicle. Our approval process is quick, usually taking about 24 hours. Having approval beforehand helps narrow down your options and close a deal quickly.
The approval process considers your financial position, credit level, and the amount you’re asking for. At Deal For Wheels, we help connect you with lenders willing to work with poor or bad credit. Don’t let your credit rating deter you; we work hard to find the perfect match, making purchasing used cars with bad credit as stress-free as possible.
Understanding the Used Car Loan:
Know what’s included in your used car finance deal. The quote includes the principal amount, interest rate, and possibly other fees. The rates are set during the pre-qualification process, considering rates across Canada and your province. Factors influencing the interest rate include your financial details, credit history, and income.
Loan Terms and Amortization:
Carefully read over the loan terms and amortization details before signing. The loan term refers to the time you have to repay the loan, usually in months. The amortization details include equal payments covering the principal and interest. Longer terms mean more affordable payments, important for ensuring affordability.
Assessing the Vehicle’s Worth
Ensure the sticker price reflects the vehicle’s true worth. Use online tools to compare average selling prices of similar vehicles. Go into negotiations armed with statistics and numbers for confidence.
Vehicle History
Check the vehicle’s history for accidents or liens. This information is available in Canada and is crucial before purchasing.
Getting a Great Deal
Our car loan calculator is your best tool to ensure clarity and comfort with monthly payments. Be realistic with your expectations and honest with the numbers you input. Adjust down payments, sticker prices, or loan terms to find your ideal amount.
Test Driving
Test drive the vehicle before making an offer. Choose a familiar route to assess acceleration, braking, cornering, parking, and lane changes. Conduct the test drive in daylight to inspect the vehicle for rust, dents, scratches, and chips.
Not Ready to Purchase?
If you’re not ready to buy, use our car loan calculator to understand current used car finance rates and what monthly payments would look like. It can also help you plan savings for a down payment or improve your credit rating to lower interest rates and payments.
Our Goal at Deal For Wheels
At Deal For Wheels, we aim to make your used car purchase as smooth and stress-free as possible. Whether you need basic information, access to our car loan calculator tool, or help finding the perfect lender, we’re here to assist you every step of the way.
