Automotive

Why a car loan is a good idea for students

So you’re a new university student, you’re about to embark on a world of responsibility and freedom. You feel ready for both, but when it comes down to doing the math, you realize that your current cash flow isn’t enough to support a car purchase. So now what? The quick solution is to get an online car loan. But maybe you’re still shy about the idea of debt. Perhaps you’re afraid a new loan will add to your already hectic schedule, or you don’t think you’ll be able to keep up with monthly payments. The truth is that there are actually a number of benefits you can enjoy when buying a car with financing.

How you go about purchasing your next vehicle is entirely up to you, but keep the following benefits in mind so that you can make an informed decision:

The Time Factor

When we hear the word ‘debt,’ many of us think ‘time.’ Not only do most people associate debt with the passage of time, but they also view it as a bad thing. That’s why purchasing a vehicle with financing may be a good option for you if you don’t have enough cash on hand to purchase your next car outright. In fact, financing your next vehicle can allow you to get some extra ‘free’ time back in return.

If you’re working with a dealer to figure out how much to spend on a car, ask him or her for the total cost of your loan. This includes items like insurance and interest. Calculate this amount, then compare it to how much you’d be paying out-of-pocket if you bought the vehicle without financing. If there’s no difference in payment amounts, you probably won’t be getting much ‘free time’ after all.

If the dealer’s going to finance your purchase in-house, ask him or her which option is most beneficial for you: a 36 or 60-month loan term. The shorter the loan payment term the higher your monthly payments will be. You’ll also have less time to pay back your loan, which is why a longer-term is usually more beneficial. Most people think that the shorter your term, the better off you are. That’s not necessarily true; it all depends on your personal budget and how much you can afford each month.

The Flexibility Factor

It’s always a plus when you can get more ‘bang for your buck’ when it comes to a product or service you’re purchasing. It’s no different when obtaining new or used car finance to purchase a vehicle.

If your choice is between two different cars, but the only difference is that one has financing available while the other doesn’t, choose the vehicle with financing. You can decide whether or not you want to use financing once all of the numbers have been calculated. You may find that paying a little more for the car with financing is worth it in the long run, especially if you want to potentially sell your vehicle at a higher price point once you’ve paid it off.

If you choose not to use financing, keep in mind that there are plenty of other costs associated with your vehicle. You’ll have to pay for car insurance, routine maintenance and repairs, and registration fees that could cost you a few hundred dollars every year.

The Security Factor

Financing a vehicle purchase is about feeling secure and comfortable in the long run. If you’re not interested in paying more than what the dealer quoted you initially, financing isn’t right for you if you’re on a tight budget. 

If you have a car accident and have a totalled car, it can be difficult to replace that vehicle if all of the money was paid up-front. With financing, however, you’ll only need to pay off the loan while you hunt for a new car.

The Safety Factor

You’ll have more control over your vehicle if you finance it, instead of having to worry about paying for repairs on a vehicle that isn’t yours. If the financing option is available during your purchase, don’t pass up the opportunity just because of preconceived notions of how much extra you’ll have to pay.

If you’re not interested in spending extra money for the sake of your vehicle’s financial security, then financing isn’t for you. You may be able to get away with paying a bit more up-front if you plan on selling your vehicle soon and buying something else instead. If that’s the case, it’s wise to focus your attention on financing for used cars.

If you’re a student or are planning on buying a new car soon and need to finance it, the benefits of obtaining financing for your next vehicle purchase will help ensure that the process is as easy as possible. We hope these tips have been helpful; if not just let us know! Our team of experts can work with you to create an SEO marketing plan that includes all the latest strategies in digital marketing including social media advertising campaigns and web design so contact us today if you want more information.

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