Reasons You Should Buy a Used Car

The idea of a brand new car is exhilarating, but for most people, used cars are more budget friendly and just make more sense. If you aren’t convinced that a used vehicle is the right choice for you, then you need to keep reading. We’re going to show you why buying used can be the best decision you make.

More Options

Buying used gives you a range of great options. Because prices are more affordable, you are able to look at vehicles you may never thought you could afford. This includes luxury designs and larger vehicles, like SUVs and trucks. In addition, you can get a lot of features for your dollar. You have the opportunity to buy the vehicle you really want instead of having to settle for only a couple options you can afford. This really opens things up and allows you to look at a range of vehicles you might not have even considered an option.

Reliability

One of the best things about buying a used car is that they generally come with all the “kinks” worked out. This just means that any manufacturer issues have often already been caught and fixed by the time you get the car. So, you get a nice peace of mind.

More for Your Money

In the past, buying used was often a gamble because cars really had a set life time. You knew if the mileage was at a certain point that there was a certain amount of life left in the vehicle. That is not really true anymore. Cars last longer. So, buying a used one really isn’t sacrificing too much. You will likely get more than enough acceptable life out of any vehicle you buy.

Before you completely write off buying used cars, take a minute to think about the reasons you should buy one. Used vehicles aren’t at all the stereotypical broken down, worn out vehicles that may come to mind. They really are great cars that have a lot to offer.

The Possibilities Created by Used Car Financing

Many people throughout Canada have the dream of one day owning a car. Owning a vehicle makes commuting to work a capability, and opens many other exciting doors. If you have a family, having an automobile is a necessity almost along the lines of water and food. Luckily for everyday people who would wish to avoid having a significant chunk of their savings eaten by the purchase a car, used car financing makes the dream of owning a car a much realer possibility.

Different Financial Options Available

A bank or loan agency will in all likelihood be able to offer you a payment plan that meets your specific needs. Some people like to pay higher monthly installments so that the vehicle is in their sole ownership sooner. Other people like to extend the duration of their payment plan so that each month requires only a small installment; that way, they have more money for the normal operating costs of their household. Going through a third-party loaning service, such as a credit agency or bank, is more attractive to the person selling their automobile. This is because the loaning service will fully compensate them up front and you will effectively be borrowing directly from the bank or credit agency.

Stipulations of a Loan

The normal stipulations associated with used car financing are not unfair. Usually, one of the only stipulations is that there is an early termination fee if the borrower does not pay off the full value of the vehicle. Also, the seller of the loan may say that you can only put a maximum number of miles on the car each year, as an attempt to avoid excessive wear and tear on the car if they think you are not looking to eventually own the vehicle outright.

Owning a Car is a Greater Possibility than Ever Before

Because of the wide array of financial services available to you, getting a set of keys to a nice used car has never been easier to do. There is truly no excuse to be missing out on economic opportunities or making things more difficult for your family due to not having an automobile.

Reasons to Buy a Small Car

In the market for a new car? A smaller car model might be perfect for your needs, no matter how tall you are. There are several benefits to be enjoyed with a compact ride, some of which that might not have occurred to you before now. Ready to learn?

Sleek Appeal

What small cars lack in size they more than make up for in exterior and interior appearance. Before passing up on smaller car models and turning the discussion to car loans when at the car dealership, take a peek inside a smaller car. You’re sure to be surprised at the sumptuous interior sure to fit your style.

Parking

No matter if you live in the city or the suburbs, it’s great to have a car that doesn’t take up too much space when it’s time to park. You’ll have an easier time sliding into parking spots, and you’ll qualify for those parking spots devoted solely to compact cars that parking garages have. Your nerves will thank you.

Gas Mileage

You can also enjoy great gas mileage with a smaller car. Even if aren’t focused on going green and cutting down on emissions, you’re sure to save green by driving a smaller, more efficient car.

Room

Taller drivers might automatically write off smaller cars, but the truth of the matter is that small cars can be surprisingly roomy. While admiring the interior of a compact model, take note of the leg, cargo and passenger room.

A More Enjoyable Drive

Smaller cars are often more nimble, accelerate faster than larger cars and break more efficiently. You don’t have to be a race car driver to enjoy this particular driving style, but you’re sure to have more fun behind the wheel.

There’s no need to think you’re making some type of sacrifice with a smaller car. As you can see, there’s much to enjoy. Start exploring your options for compact cars today.

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 preowned 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.

Financing a Used Car With Bad Credit

When you have bad credit, it can be difficult to finance a used car. Everyone needs reliable transportation, but having bad credit oftentimes translates to higher interest rates and car payments. Despite these common obstacles, there are ways to get financed, even if your credit isn’t in the best shape. If you have a low credit score and you are in the market for a used car, here are some things you can do to increase your chances of securing financing.

Make a Large Down Payment

Making a large down payment is a simple, yet effective way to boost your chances of getting approved for financing. It shows financial institutions that you are serious about purchasing a vehicle and that you are capable of saving and managing money. You also present less of a financial risk, since buyers who invest large sums of their own money are less likely to default on loans. Buyers who make a down payment may also gain access to better interest rates.

Rebuild Your Credit

This may seem like an obvious course of action if you have bad credit, but it is the most efficient way to ensure that you get approved for a loan. Paying off overdue bills and establishing a history of responsible credit use can go a long way when it comes to securing financing. Car buyers with lower scores will be subject to higher rates and less favorable payment terms.

Use a Cosigner

Using a cosigner can greatly improve your chances of getting financed. Enlisting the help of a spouse or close family member is the most common practice when it comes to cosigning. It should be noted however, that if you do not make your monthly payments on time, your cosigner will also be held responsible.

Don’t Despair

In the world of used cars, there are practical ways to secure financing with bad credit. We offer customers a variety of financing offers, and we are sure that we can work with you, regardless of your financial situation. Don’t give up just yet; there are many ways to finance a car with less than perfect credit.

Everyone likes to get a good deal. When you are offered a low monthly payment on your car loan, that might seem like the best deal of all. In the long run, however, that low monthly payment might actually end up costing you hundreds of dollars more than you intended to pay. In order to understand the true total cost of car loans, you must look at three different factors.

Loan Amount

The initial amount you borrow is called the loan principal. The amount of principal you have left at the end of every billing cycle is one half of the equation that determines how much you will pay in interest. To lower the total amount you pay on the entire loan, it is a good idea to start with a lower principal. If you are able to pay 20% of the initial $25,000 cost in a down payment, that is $5000 of the purchase price that never figures into the interest you are charged.

Loan Rate

The other half of the interest equation is the interest rate itself. Bargaining for a lower interest rate can significantly reduce the price you ultimately pay for your next vehicle. A great credit score and other factors, such as dependable income, can lower your risk factors with the lender and thus can result in a lower APR, saving you a great deal of money.

Loan Term

A lower monthly payment might be tempting. When you accept a lower monthly payment, however, you are lengthening the term of your loan, postponing the date when the car will be paid off and costing yourself a lot of money in the process. You will pay significantly less interest with a 2- or 3-year loan term than with a 4-year loan.

When negotiating the terms of car loans, fight the urge to take it easier than your monthly budget can handle. Factor in the amount, rate and term of your loan to get the best deal overall.

How to Finance a Used Car in Canada

If you’ve found the new-to-you car of your dreams but don’t have the cash to pay for it in full, financing is the solution. In this post we’ll go over everything you need to know so you can secure the right kind of auto financing for your vehicle and your bottom line.

How car financing works

Taking out a car loan eliminates the stress of coming up with a large sum of money all at once. However, it also adds another monthly payment to your budget, so it’s important to understand the ins-and-outs of car financing before looking at the different lending options.
Your monthly car loan payments are calculated using three elements: principal, term and interest rate. 
Principal is the total cost of the vehicle, including any fees the lender or dealership may have for the car loan and any add-ons you choose.
Term is the length of time that payments will be made on the loan — typical terms range from 36 months to 72 months.
Interest rate is the percentage the lender is charging you to borrow money. 
Fixed rate loans offer predictability because the interest rate stays the same throughout the term of the loan. If you’re less concerned with fluctuations and want to benefit from times when interest rates are lower, you can opt for a variable rate loan.

Borrowing for new and used cars

New and used cars get treated differently by lenders for a few reasons. For starters, new cars have a higher sticker price than pre-owned cars. While this usually means buyers can cash-in on incentives like rebates or 0% financing for a certain period, it also means loan payment terms will be longer and monthly premiums will be higher. Also, new cars are usually more expensive to insure. 
Used cars, on the other hand, cost less to purchase. They do, however, require more upkeep than new cars and interest rates on pre-owned vehicles are usually higher — especially if you don’t have much for a down payment or have less than stellar credit. 
Check out our post for things to consider when deciding whether to buy a new or used car.

Ways to finance a used car

There are two main ways to secure a car loan in Canada: through a financial institution or directly through a dealership. Each route has its advantages and it’s a good idea to shop around to ensure you’re making the best decision for your financial situation. 
Before applying for any loan, it’s a good idea to check your credit rating and determine your budget. Whether high or low, your credit rating will dictate the interest rate on your loan; knowing your budget will help you figure out how much you can afford for monthly payments. If your monthly payments are more than your budget allows, you run the risk of defaulting on your loan and damaging your credit rating.
Figuring out your budget can also help you decide how much you’re able to put forward as a down payment —  a larger down payment often translates to lower rates because you’ll be borrowing less.
Now, let’s get into the differences between bank financing and dealership, or in-house, financing.

METHOD 1: BANK FINANCING

If you have a good credit rating securing a used car loan through a bank or credit union might be the right choice for you. Getting a loan through your current financial institution can be a convenient option since all of your finances are in one spot. If you’re an established customer, your bank might even offer you a discount on interest rates or fees and most banks are open to negotiating the terms of your payment period.
However, because of their stricter rules and regulations, banks will only grant loans to customers with favourable credit — even for pre-owned vehicles. So, if you have a low credit rating you might not get approved. 
Some banks are wary of granting loans for used cars because they depreciate in value quickly. It’s a good idea to ask about the financing options for the specific make and model of the car you’re interested in.
It can also take longer to get approved through the bank, so you might be stuck waiting several business days to find out if your loan application has been accepted.

METHOD 2: IN-HOUSE (DEALER) FINANCING

The second option is to get financing directly from the dealership you’re buying a car from. The main advantages of in-house financing are speed and flexibility. 
Because the application and approval process is a lot quicker, many dealerships are able to offer same-day financing. That means you can take a test drive in the morning and drive your new (or new-to-you) car off the lot by the afternoon. This way you won’t have to worry about someone else snatching up the used car you fell in love with while you’re waiting for financing to come through. 
Dealerships offer significantly more flexibility for borrowers with less-than-stellar or non-existent credit (as is the case with students or new Canadians). If you have poor credit or have gone through a bankruptcy, shopping for a vehicle can be frustrating and disappointing. In-house financing can help get you into the car you want, even if you’ve been previously turned down for a loan through your bank. 
At Birchwood Credit Solutions, we look beyond our customers’ credit rating. Once you apply for financing, our team will review your whole financial situation and work with you to pick an appropriate budget and payment options. We can even offer you help and advice on how to repair your credit rating.
Learn more about Birchwood Credit Solutions’ Bad Credit Car Loans and quick, hassle-free application process. You can also contact us to talk directly to a car financing expert.

When is the best time to buy a car?

Getting a good deal on a new or used car can depend on the time of year you buy it. Make sure you keep an eye on the calendar so you can take advantage of seasonal factors affecting the car trade and take advantage of the best month to buy a car. So if you are looking for the best time of year to buy a car, here are some dates to bear in mind.

  • Best time to buy a new car
  • Best time to buy a used car
  • Your next step

Best time to buy a new car

Choosing the best time of the year to buy a car could potentially save you thousands of pounds.

Here’s what to bear in mind:

  • Convertibles are more desirable in the summer, so there might be bargains to be had in the winter.
  • At the end of each quarter – particularly the end of June and December – dealers might be keen to hit their quarterly sales targets and more likely to offer you a good deal.
  • Demand for four-wheel-drive vehicles usually peaks during autumn and winter because of poorer weather, so you might get a bigger discount in the summer.
  • In February and August many dealers offer some real bargains, while sales are slow as buyers wait for the new number plates coming in March and September. But If you take advantage of this lull, your ‘old’ number plates will make your car seem older than it really is, so it will depreciate faster.
  • Find out when new models or ‘face-lifted’ existing models are due out, then buy the previous version during its last few weeks in the showroom. Dealers will be want to shift this stock and be more likely to offer you a good deal. But remember an older model will depreciate faster than the new arrivals, even though it’s roughly the same age.
  • Showrooms are quieter on weekdays so drop in on a Friday – when the dealer will also be keen to meet their weekly target. This gives you an advantage when bargaining with the salesperson.
  • Wait a few months after launch before buying a new model – by then there will be less showroom buzz about it so the dealer might well offer you a better deal.

Best time to buy a used car

Seasonal trends in sales of new cars have a knock-on effect on the cost of used cars.

Time your purchase right and you could get a real bargain:

  • Avoid buying used convertibles in the spring or summer – wait until winter, when demand is much lower.
  • March and September are the peak months for sales of new cars, often through part-exchange deals. So dealers will have lots of used cars to sell, which puts you in a strong position when negotiating.
  • Dealers are also often keen to clear out used cars in July and early August in readiness for new models and the registration plate change on 1 September.
  • December and January are quiet months for the used car trade. Cars aren’t on people’s minds around Christmas and the New Year so dealers and private sellers are keen to make a deal.
  • Buy four-wheel-drive vehicles in the summer – demand peaks in the late autumn and winter because of the poorer weather.

Advice and Negotiation Tips for Shopping Used Cars

Buying a vehicle is never easy, but buying a used vehicle is downright difficult. You will get your hopes up numerous times by an ad that seems too good to be true, only to be let down when, in fact, it was too good to be true. Someone might advertise their car as “Like new! Mild wear and tear! Runs great!” when in actuality, it is very much old, has extensive wear and tear and doesn’t run at all. Yes, it happens. That is why, when shopping for used cars, you should know where to turn and how to negotiate. Don’t fall for a scam and bring home a lemon, and use the following advice to help ease the pain of your search:

Go to a Dealer

Sure, you know someone who found a great deal on Craigslist, or are even friends with that lucky person who bought a car on Ebay ten years ago and it’s still running great today. However, those people are the exceptions to the rule that states that you should never, ever shop for used cars online. Not only is it impossible to tell the true condition of a vehicle without actually seeing it, but also, you’re risking spending thousands of dollars a car that may take a dump on you ten minutes after purchasing it. Then, because there is no warranty, you’re stuck with an old car that doesn’t run and no money to fix it.

Find the Car You Want

Before you head to the dealership, know what you’re looking for. If you head to the dealership without a clue, you may end up purchasing a vehicle that is over your budget and all wrong for your needs. Identify the traits you need in a new used car: good gas mileage, three rows, ample storage space, etc. Once you do this, set a budget and head to the dealer.

Negotiate Like a Pro

Negotiating for a fair price might be the most daunting part of the car buying process, but it’s necessary. Dealerships expect you to negotiate and price their cars accordingly. Use all the knowledge you have regarding the vehicle to bring the price down.

Use the tips above when shopping for used cars to get the best your money can buy.

3 Ways Dealers Help You Find the Perfect Used Car

Despite popular beliefs, seeking the assistance of a dealer while searching through the multitude of available used cars is a smart move which any budget-conscious buyer should consider when in the market for a ride of any shape, size or brand. There are many ways in which using our dealership for assistance throughout the shopping process makes the whole experience simpler and much less stressful, but the top three include:

We Offer a Larger Selection

Whereas you may have to drive hours to view a single car when shopping among private sellers, our large selection of vehicles gives the ability to view many new cars at once, increasing your chances of finding the perfect used car quickly. This saves you time, money, and plenty of energy with which to enjoy your newly-purchased ride after the decision has been made.

We Offer Financing Options

In most cases, even used cars have financing options available for buyers of all backgrounds. This means that you won’t be restricted to one or two cars on the lot that fit within your immediate budget. Together, you and our expert staff members can work out a payment plan for practically any of our used vehicles, expanding your opportunities and helping to ensure you find the right car for your needs.

We Offer Quality

Aside from offering an excellent quantity of vehicles, we always ensure that our used cars present quality under the hood as well. Before selling cars to customers, we inspect the vehicle and make repairs as necessary to ensure you’re getting what you pay for: a reliable ride that’ll get you from one place to another without a hassle. When you find the right car, you’ll never have to worry about it being a lemon.

These are just some of the ways in which we can help you find your perfect used car and get you on the road again in no time. Check with us to learn more about your options.