As Canadians, we love our cars; it is our source of freedom and a necessity to lead a normal life up here in the Great White North.
If you need a newer vehicle instead of buying a brand-new car, you might consider opting for a used model.
Making a case for buying a used car in 2022
With rising gas prices, a growing number of Canadians are trading in their gas-powered cars for EVs.
While buying an EV is a great option if you have the budget, for a significant portion of the Canadian economy, buying an EV is not practical due to a lack of charging infrastructure in rural parts of Canada. In 5-10 years from now, an EV may make sense, but for today, gas-powered is still the preferred option.
The rising number of used cars being traded in means there is an excess inventory of cars that are available for sale.
Everyone knows that when there is an oversupply of a commodity, in this case, used cars, the prices will be more competitive, and you can walk away with a good deal.
Don’t buy from private sellers
The single biggest mistake you can make is to buy a used car from a private seller; the used car market is rife with scams being committed by private individuals.
To protect yourself from being ripped off, you should only deal with licensed, used car sellers that have a pristine track record.
New car and used car interest rates are very similar
Prior to the pandemic, you could buy a new car with zero percent interest (provided your credit score was high).
The days of cheap credit are behind us; with the Bank of Canada raising interest rates to try and combat inflation, lenders need are taking on additional borrowing costs accessing capital, and those added costs are passed on to you, the consumer.
Since interest rates on new and used cars are very close, the less money you borrow, the less interest you end up paying, so buying a used car can make sense depending on your budget and needs.
Opt for an extended warranty
Something that you should do when buying a used car is to opt for an extended warranty. The dealership that is selling the used car will offer it as an option.
A great benefit of having the purchase financed is you don’t have to pay for the extended warranty in one lump sum; the lender will provide you with the funds to pay for the extended warranty and vehicle in one shot.
Finding the right used car for your particular needs
Each used car deal is unique, especially if you have credit challenges or income that is hard to verify. What you can do is reach out to a dealership in your area that has been selling used cars for quite some time.
By working with these local dealerships, you will get top-notch customer service and a competitive car loan, but you need to contact the 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!