Can You Get a Loan for a Used Car?

If you are like many car buyers, you want to buy a used car instead of a new one. For many reasons, that makes a lot of sense. You might wonder, though, if car loans are available for used cars. Generally, the answer is yes. Here are some things to consider when applying for a used car loan.

Think About Purchasing at a Dealership

If you need to finance your used car purchase, you should consider buying the car from a dealership. Generally, dealers are in a better position to finance used cars than other institutions. In fact, many dealers routinely finance used car loans. While there are exceptions, banks, credit unions, and financing companies generally prefer to finance new cars. Because they have a better chance of realizing a return on their investment with new cards, traditional financing companies often have rigorous application processes for used car loans. While you might ultimately be successful, getting such a loan from a conventional lender can be extraordinarily stressful. Thus, if you want to finance a used car, you should probably buy your car at a dealership.

Know Your Credit Score

Like with financing a new car, you will be better able to negotiate beneficial used car loan terms if you know your credit score. Before you start shopping for your car, request your score from one of the credit bureaus.

Don’t Choose Too Old of a Car

The newer your used car is, the greater your odds of securing financing. While there is no absolute limit, generally cars older than four or five years are more difficult to finance. On the other hand, if you run into trouble financing your older used car, you might look for a new car. Often, those who are unable to get a used car loan have no problem with new car financing.

Before you shop for used car loans, consider the unique challenges of applying for one. By knowing what to expect, you will be in a better position to secure financing for your used car.

Top Benefits of Used Cars

There are numerous reasons to be excited about buying and owning a used car – the cause that is most compelling can vary from one individual to the next. The motivations for purchasing a pre-owned vehicle can be lumped into two main categories: style preference and budget. As for people who are looking to save some money on getting an automobile, the majority of them can meet this goal by preferring to drive cars, SUVs, vans, or trucks that have had at least one prior owner. The benefit of style might not be something that requires explaining, as entire communities have been built around classic and antique enthusiasts.

The Affordability Is Superb

Many people would be quick to take advantage of any opportunity to save thousands of dollars – especially if there needs can be met just the same as if they had paid the higher price. Buying used cars is a strategy that can be deployed in order to protect the balance of your bank account by allowing you to satisfy your need for personal or family transportation without paying much. In many instances, the high level of affordability inherent to pre-owned autos enables buyers to get a better car than they originally thought they would be able to buy.

You Get to Own Your Favorite Model

While a lot of people pick the vehicles they purchase purely for budget and functionality, there are still many who get a particular car because it is the one that best matches up with their tastes. For car enthusiasts, lots full of used cars is where they have the most pleasure shopping for their next automobile – the Chevy Camaro and the Ford Mustang are prime examples of cars often purchased used because of the performance and visual appeal of earlier models.

The list of benefits of buying a pre-owned can be quite long, but a great percentage of the people who purchase used find that either their taste in style or the friendliness towards their budget the most compelling reasons.

Tips for Buying Your Teenager a Used Car

When your teenager reaches driving age and wants a car, you will probably have many decisions to make. Not only will you have to compromise with your teen when it comes to what you will pay for and what make and model is acceptable, you will also have to consider which used cars are the safest for him or her to drive. If you’re ready to buy your teen a car, we’re here to help with a few tips that might make the processes easier.

Think Simplicity

While your teenager probably has a make and model already in mind, you may want to make some boundaries clear before you start browsing used cars together. Not only will price be a factor, but it can be expensive to insure teen drivers as well. Their age and inexperience make them a considerable liability to many insurance companies, so choosing a no-frills vehicle may help you save money.

Do Your Homework

While we can help you choose a safe used car for your teen, it might also help if you perform some research on your own before you visit our lot. Take the time to discover which used cars have the best safety ratings, which ones have additional safety equipment that might keep your child safer and which are the least expensive to operate. The more you know before you begin to look at individual cars, the easier it might be to arrive at a decision.

Prepare Your Teen for Test Drives

Even if you will be doing much of the legwork and putting up the cash for your teen’s car, you may still want to prepare him or her for what will be involved with test driving vehicles. Teach them what to look and listen for and help them prepare a list of questions to ask our sales associate for during and after a test drive.

Buying your teenager his or her first used car doesn’t have to be a headache. Compromise, research and careful planning can all ensure a more enjoyable buying experience for you both.

Getting the Best Interest Rate on a Used Car

You’ve narrowed down your search for the perfect used car for your needs and budget and are ready to address your finance options. If you won’t be buying the car outright, you’ll need to finance it, which means paying interest. To avoid paying more than necessary for used cars, you’ll want to keep your interest rate as low as possible, which you can easily do with a few good tips.

Think About Financing Through the Dealer

While you might think financing your car through a dealer is automatically more expensive, the truth of the matter is that doing so could net you a pretty solid deal. This is because dealerships can offer incentives like zero-percent financing and other specialized low rates. Check to see what’s on the table before you think about financing elsewhere.

Consider a Certified Pre-Owned Car

It seems counter intuitive, but older cars usually come with higher interest rates when compared to newer models. Instead of thinking you’re better off with a new model, consider the fact that dealerships sometimes have zero-percent interest specials on their certified pre-owned cars. Be sure to ask about them as you’re walking up and down the aisles checking out cars.

Consider Your Term Length

If it’s at all possible, get a car loan with the shortest term length possible. The reason for this is that a shorter term length equals a shorter repayment length, which means a lower amount of interest paid over the life of your loan. Another great thing about getting a term length as short as possible is that you don’t have to worry as much about being upside down on your loan, which is what happens when you owe more on your car than it’s worth.

As you can see, there are several things you can do to keep the interest rate low on your used car. Be sure to put these tips to good use.

How to Save With Dealer-approved Car Loans

People want to save money on products they buy, and this is most true of products that cost more. Cars are one key example. People certainly are inclined to make any effort to save money on car loans when the overall price can represent such a large sum. Car dealers have access and industry insight that can save people money in the long run. Working with one can potentially save anyone looking for a car a reasonable amount of money.

Preferred Lenders

Dealerships often negotiate car loans through a bank. Because these companies have so much business, they often qualify for special rates at a number of financial institutions. This can be advantageous for many customers looking for a good deal. The connections a dealer has can lead to a better price for consumers. It is important to check with a dealership to find out what sort of options it can provide.

Less Down

People looking for car loans through a dealership could also qualify for less down on competitive rates. It could benefit a person looking for such loan to pay less in the beginning and enjoy good rates such as those that a dealership can provide. Even if the dealership cannot guarantee better rates for less down, it still can offer competitive rates for a potentially smaller amount of money. Working with a dealership can be important for anyone who wants more personalization with his or her car loan.

More Options

Another opportunity a dealership can provide is more options. Dealerships have been selling cars for years, and they can leverage their industry knowledge to create a better end result. A person in such a situation should consider reaching out to the professional service with particular requests.

Anyone looking for car loans should explore his or her options and see how a dealership might be an essential part of owning a new car.

The Benefits of Buying a Previously Owned Car

Cars are a wonderful invention that have shaped the world since their ubiquity following mass production thanks to Henry Ford’s assembly line. Entire industries were created catering to automobile owners, and countless others have benefited from the expedited travel that cars offer. Like anything, cars wear out and break down. When a car stops working, and a replacement is needed, the best place to turn is a trusted car dealership.

Working with a Dealership

A licensed car dealer specializing in used cars is the recommended stop for a vehicle purchase. Cars are considered to be depreciating assets. An informed consumer recognizes this and mitigates initial depreciation by purchasing a used vehicle. Whether the customer is an expert on cars, or they are buying their first vehicle, a trusted dealership can guide them to the best automobile for their needs, taste, and price range.

Financing a Used Vehicle

Car loans are a great way to purchase a used vehicle and build good credit in the process. Placing a significant amount of money down towards the total cost of the car will help lower monthly payments on a car loan. Previously owned cars are relatively affordable, via accommodating financing, people in most financial situations are able to purchase a vehicle by choosing a used one.

Dealerships offer financing options and usually staff people that specialize in car loans and creative lending options. The consistent payment of these loans overtime is an awesome way to build good credit. Better credit equals better financing options for future loans. It is a symbol of responsibility reassuring lenders that the money they provide will be repaid.

Car dealerships specializing in used vehicles provide a comfortable place to fulfill anyone’s car buying dreams: simplifying and facilitating a stress-free purchasing experience like the gravy on poutine facilitates a full belly.

Why Canada’s used-car world is becoming a buyer’s market

TORONTO — The balance of power in the used car market is shifting towards shoppers as improved data and online offerings create more opportunities to push for the best price.

A fast-evolving online marketplace is providing more intelligence on the fair value of cars, said Cliff Banks, a Detroit-based auto retail expert.

“I don’t know that it can be any more transparent…they all provide intelligence on the pricing and the deal of the vehicle, whether it’s a good deal, a fair deal.”

Kijiji Canada recently announced it will add a standalone auto sales site that will roll out later this year to keep up with shifting expectations. The site will add reviews of dealers as well as market pricing information from Carproof.

“The key feature for us, and one of the biggest, the biggest win for us is what’s called price transparency or price analysis,” said Matt McKenzie, general manager at Kijiji Canada.

The online classified company, owned by eBay, already boasts of being the largest player in the Canadian market with about 500,000 vehicle listings. Autotrader, owned by Etobicoke-based Trader Corp., lists about 444,000 vehicles on its site while there are many other offerings on the market as well.

Listing companies are boosting their online presence as the used vehicle market is set for significant growth, said Dennis DesRosiers, president of DesRosiers Automotive Consultants.

“There’s tremendous opportunity, and that brings in all the different retail players and their approach of, how do I get a piece of that?”

While new vehicle sales are expected to be largely flat at about two million this year, the used vehicle market is set to add half a million more in sales in the next three to five years, on top of the three million that changed hands last year, said DesRosiers.

The rise in the used vehicle market comes as improved quality in the past decade means cars and trucks are lasting much longer, allowing for a potential lifespan of four to six owners from the two or three expected not long ago.

“It takes 23 years to remove the vehicles from the road now, a decade ago it only took about 12, so it’s essentially doubled,” said DesRosiers.

Used vehicles also offer margins that are two to three times higher than for new cars, adding to their appeal, he said.

The quality and information improvements have significantly changed the overall used retail market, said DesRosiers.

“It’s not that far long ago, call it 15 years ago or maybe 10 years ago, where the used car market was largely a culture of deceit…even if the online capacity was there, there was just so much riffraff in the used car market that it was very dangerous. A lot of that has changed.”

The improved access to data means used-car retailers have to be more transparent and competitive about their pricing, said Jamie Tekela, director of pre-owned operations at Pfaff Automotive Partners.

“You need to really justify what you’re asking, why you’re asking it, and you can’t go asking $500 more for the same Honda Civic with the same mileage. It just it doesn’t work any more.”

“It’s night and day, to be perfectly honest. It’s gotten a lot more customer friendly,” he said.

The improved information on crash reports, comparable sales, and other metrics hasn’t done away with potential negotiations but does give more justification, said Jamie.

“There’s always going to be negotiations when trying to buy and sell vehicles, but with so much information available to each and every one of us, it’s a lot easier to explain our rhyme and reason why we’re asking what for a car.”

How to get the best possible deal when buying a new car

Buying a New Car? Be a smarter shopper.

Most consumers making any big purchase will undoubtedly shop around for the best prices. This is definitely the case when it comes to the second most expensive purchase most consumers will make aside from their home — a new car.

The difficulty is that it can be an intimidating and time consuming process. The old fashion way of buying a new car for most people involves spending their evenings and weekends driving between different dealerships and negotiating with sales people and sales managers.

RELATED STORIES

PHOTOS

chevrolet, cruze, sedans, dealership

In this Feb. 19, 2012 file photo, a line of 2012 Chevrolet Cruze sedans sit at a dealership in the south Denver suburb of Englewood, Colo. (AP / David Zulubowski)

The reality is that very rarely does a consumer pay full manufacturer suggested retail price for most vehicles, and often two people can purchase the exact same car but at vastly different prices that could amount to hundreds or even thousands in lost savings, depending on how well they negotiate. And so it is worth it to do your research to make sure you’re being smart about your money and getting a good deal.

Luckily, there are some great online tools that can help make the whole process a bit easier — saving you both time and money. Here are three common mistakes consumers make when negotiating a new car deal:

1. Negotiate the total price, not the monthly payment

Most people will finance or llease their vehicle and are focused on whether their monthly payment is affordable. When it comes to negotiating though, you should negotiate based on the total vehicle price including all fees and taxes, not the monthly payment. It is easy to forget that a $10 or $20 change to a monthly payment may not sound huge, but it can quickly add up to hundreds or thousands of dollars over the life of the vehicle.

It can also be difficult to compare monthly payments between different dealerships as you may be looking at different maturities or down payments. Negotiate based on the total vehicle price, and remember that all dealerships will be able to provide you with the same advertised financing or lease rates from the manufacturer, so the dealership with the best total vehicle price will still be the best deal whether you lease or finance.

2. Check for manufacturer incentives

When negotiating a discount, make sure any available manufacturer incentives are applied before you start negotiating. You’ve seen the advertisements where a vehicle manufacturer offers a big cash incentive that can be worth thousands off the vehicle price. For example, if there is a $4,000 incentive from the manufacturer and a dealer offers you only $4,000 off the manufacturer suggested retail price, well then the dealer is not really offering any discount at all. Keep in mind that the $4,000 incentive comes from the manufacturer and everyone will get it. So your negotiation with the dealer should start after subtracting all applicable incentives.

3. What is a good deal?

The most common question consumers ask when buying a new car is
“What is a good deal?” Unfortunately, the answer is that it can be different for each car. One of the most effective ways to negotiate is to find out the dealer invoice cost, which is the wholesale cost of the vehicle, essentially what the dealer paid to purchase it from the manufacturer before adding profit and selling to the consumer. The difference between the full manufacturer suggested retail price and the dealer invoice cost is essentially your negotiating room. Keep in mind that dealers are businesses and they do need profit to keep the lights on and provide good service, but getting the dealer invoice cost gives you a better understanding of the negotiating room.

You can get dealer invoice cost reports for free from Unhaggle.com if you’re preparing to negotiate on your own. Unhaggle.com also offers a tool called Quote Your Own Price that allows you to make offers to local dealers for the price you want to pay from the comfort of your computer. This lets you skip any awkward in-person negotiations. Unhaggle.com’s tools will also provide you with an estimate of the average price of what other consumers have paid for the same vehicle and a recommend target price for your negotiations based on data gathered from a national network of new car dealers.

In any case, it’s okay to buy nice things once in a while and a new car is definitely one of those exciting things. Just remember to be smart with your money and follow these tips to ensure you’re getting the best deal.

Car Shopping: 3 Ways to Offset Bad Credit

When you try to get a loan for a car from the dealership, one of the first things we look at is your credit score. If your score is low, however, there is still hope. There are ways to get approved for the car loan you need even if you have bad credit.

 

Qualified Co-Signer

 

A co-signer with better credit can be your saving grace. Having someone co-sign the loan can help you get the car you want while reassuring us that the loan will be paid. The co-signer agrees that, in the event that you do not make payments, he or she will take responsibility for them. You get approved, and we get assurance that the loan will be paid.

 

Trade-In

 

Another way to be approved for bad credit car loans is to trade in your old vehicle for the one you want to purchase. The value of the trade-in can lower the total loan amount, making lending to you less of a risk, even if you have bad credit. The car you no longer need can help you get the next car.

 

Large Down Payment

 

As lenders, we tend to consider bad credit a big lending risk. If, however, you can demonstrate that your credit is not indicative of poor cash flow, it is not so much of a problem. One way to do that is to offer a large down payment on the car. If you are able to put a significant portion of the car’s value down, this increases your chance of being approved for a loan. It lowers the amount you will need to borrow and proves that producing money is not an insurmountable challenge to you.

 

Even if you have bad credit, it is still possible to be approved for a car loan. Credit score is just one factor used in determining approval.

6 Questions to Ask Used Car Dealers

The purchase of a used car is major monetary investment. There are risks involved, such as buying a vehicle with hidden flaws and mechanical issues. However, a potential disaster is avoidable when you ask dealers the right questions. With a little due diligence on your part, you’ll walk away with the right car for the best deal.

Is This a Certified Pre-Owned Vehicle?

Certified used cars give you an added peace of mind. These vehicles undergo extensive inspections. Additionally, these autos are covered by a manufacturer’s warranty.

Do You Accept Trade-Ins?

Trading in your current vehicle has two major benefits. One, you avoid the hassle of selling it yourself. Second, your car’s value is applied toward the used automobile, which lowers your payment.

Is There a Discount for a Cash Purchase?

Buying your vehicle with money is a win-win situation. With a cash only deal you can buy the auto below the sticker price. In turn, the dealer gets a quick sale and money on the spot.

Where Was the Car Purchased?

Dealerships acquire used cars from a variety sources. The common places include other dealers, rental car companies, customer trade-ins and auctions. Knowing where an automobile comes from gives you a complete picture of the vehicle’s maintenance and ownership history.

Can My Mechanic Perform an Inspection?

Trustworthy dealers have no problem allowing your mechanic to look over the auto. Your repairman can spot existing problems as well as potential hazards.

Have You Performed Maintenance Checks?

Used cars often sit on a dealer’s lot for weeks or months. In many cases, repairs and maintenance checks are conducted during that time. If there is any recent work done, it helps you cut the cost on future repairs.

Reputable dealers look forward to answering your questions. The more you know about a used auto, the better. Asking questions helps ensure your dream car doesn’t turn into a nightmare. Here at Walker Auto Sales we welcome any and all questions. Please drop by and visit us soon.