Benefits Of Taking Used Cars Finance
Many people find the idea of purchasing a car daunting, often necessitating them to go through the hassle of applying for financing and waiting weeks to see if they qualify. That is why some opt to purchase pre-owned cars instead. If you are one of these individuals, here are some advantages of taking out used cars in sacramento finance:
- Lower Down Payment Required
Like many types of loans, financing a used car requires at least 10% down payment. While this may be doable for some people, others may struggle to save the required amount of money. If you fall into this latter category and still wish to purchase used vehicle, know that with used car financing you can make much smaller down payments – typically only 5% or less on average.
- Used Cars are More Cost Effective
With used car financing, the required down payment is lower, meaning that you pay less money up front and ultimately end up paying less in overall cost of owning the vehicle. One way to reduce monthly payments is by selecting the cheapest model available; this leaves more cash left for down payment and other associated costs associated with buying a vehicle. With used car financing, however, these amounts may change due to changes in market conditions or other considerations.
- Longer loan term
When you make a lower down payment for used car financing, the longer loan term you can obtain will save you money in the long run through reduced interest payments. So in essence, making smaller down payments now could pay off big time in the end.
- Lower interest rates
Due to the low price of used cars, manufacturers can offer lower interest rates with used car financing than they would with traditional bank loans. You could get as low as 3% interest with used car financing while most bank loans range between 10%-13%. That makes using this form of financing much more cost-effective than taking out a traditional bank loan when shopping for your next vehicle.
- Higher car value
Some people opt for used cars over new ones in order to save money on their transportation needs. They do this by selecting models that maintain their value over time, such as models no longer in production. As a result, older cars will usually offer greater value than their more recent counterparts.
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Written by Dan Harrington
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