There is a significant number of Canadians who have decided not to buy a car in 2022 due to the pandemic. The economic uncertainty alone was the primary reason why drivers were taking a “wait and see” approach.
With the Omicron variant here to stay, it seems that Covid is not going away and we just need to learn to live with it. The variant is going to add pressure to the fragile supply chain which will lead to additional shortages including a limited supply of new and used cars.
This is not fearmongering, just head over to your local supermarket and you will notice certain items are no longer available, the supermarket uses cardboard cutouts to hide the shortages.
Interest rates will start to rise
We have established there is a shortage of cars and interest rates are going to start climbing. Everyone has been speculating on when this will happen but the Federal Reserve south of the border is going to start in the Spring of 2022 and the Bank of Canada will follow suit.
There is a narrow window where you can buy a car in 2022 at a low-interest rate and have a reliable vehicle to help you ride out the supply chain shortages being experienced.
Strike while the iron is hot
This opportunity to get a new car is very limited, with each passing day the number of cars that are available goes down and car prices will continue to rise with inflation.
What you need to do is make sure your finances are in order and begin looking for a competitive car loan. To get a good interest rate on your new car, you need a credit score of 680, this does not mean you can’t buy a car if your score is under 680 but you are going to pay a higher interest rate.
The majority of Canadians paid down their credit card debt during the height of the pandemic, if you were like most Canadians, your credit score should have improved. If your score is below 650, you need to take a closer look at your finances and figure out what is the cause of the low score.
Sources of the most competitive car loans
You will not be able to find the most competitive car loans online. The only way you will get a super low-interest rate on a new car is by going through a local car dealership.
These dealerships have a network of lenders they work with constantly. This relationship with the lenders gives the dealership access to wholesale lending while all of the websites you come across online can only access retail lending rates.
The dealership is able to give you advice on how to raise your credit score and has cars in their inventory that you can purchase today.
We have established the car shortage is going to get worse and the economy is still trying to get back on a solid footing. If you need to buy a car in 2022 and frankly most Canadians do, then you need to head over to your local car dealership today.
For those of you who know that you have a challenging credit situation, please visit Dixie Auto Loans where we have a team of credit specialists ready to help you get approved for a car loan today!
For any questions or concerns, please don’t hesitate to contact us here!