Should I finance a car or pay cash? It’s one of the many decisions you’ll face when buying a car, and the answer depends on your personal circumstances.
If you’re in a fortunate position to buy a car in cash, then you could save yourself a lot of money on interest rates and repayments. It’s a wonderful position to be in, but how many of us readily have the cash available to buy a car?
Financing a car is a common choice, with people choosing to spread the cost of a car over several years. While this does mean that you’ll pay more money in interest, it can be a better solution for managing a budget and making a car more affordable.
Should you choose to pay in cash or get finance for your car? The following guide can help you make the right decision for you.
Finding the right car finance
Alongside credit cards, car loans are a common source of credit and can help you buy the car you’re looking for. When you apply for a car loan, you’ll be given an interest rate and monthly repayment amount, helping you to find a loan that best suits your budget and circumstances.
There are a lot of different car loans out there, and it can be confusing trying to find the right one for you. Instead of making multiple searches and wasting hours of your time, finding the right car finance through Awesome Car Loans can help make sure you find the best deal without having to do the leg work.
What do I need to do before I apply?
Applying for a car finance loan is simple. Some of the things you’ll need to consider before you apply include:
- The type of car you want
- How much you’re willing/able to spend per month on repayments
- How much interest you’re willing to pay
- How long you wish to finance your car for
With this information, you can start looking at cars to find your dream vehicle. Whether it’s a new, used or commercial car, you’ll be able to choose from a range of car loans to help you buy it.
Once you’ve chosen a car, you’ll need to gather all of your documentation (identification, banking details, driving licence, etc.), ready to begin your finance application.
Should I finance a car or pay cash?
Deciding whether to finance or pay cash for a car can be a difficult decision. You’ll need to weigh up the pros and cons of each payment method to help decide what’s right for you.
Paying in cash
Some of the benefits of paying in cash include:
- You’ll own the car outright
- A one-off payment means less hassle
- You’ll save on interest
- You can sell the car whenever you want
Meanwhile, the cons include:
- Cars depreciate in value quickly
- Money spent on the car could’ve been saved for use elsewhere or invested
- You’re bound by the amount of money you have to spend
Paying with finance
Some of the benefits of paying with car finance include:
- The chance to buy a better car
- You’ll have a fixed monthly payment to spread the cost
- Ideal if you’re on a tight budget
- Could help you improve your credit rating.
Some of the cons include:
- Having to pay interest
- Restrictions on modifications
- Additional fees to pay for mileage and damage
- Difficult to get out of
As you can see, there are positives and negatives for each type of finance option. But even if you can afford to buy a car in cash, financing could be the most suitable option for you. You’ll have a wider choice of cars to choose from, and having a larger deposit could help you benefit from lower interest rates. Car finance can be easy to manage when you find the right deal; you just need to know where to look!
Applying for a car loan with Awesome Car Loans
Applying for a car loan with Awesome Car Loans is simple. Head to our application page and enter your details, making sure they’re accurate. One of our representatives will call to confirm your information and use what you’ve provided to help find the right loan for you. Using Awesome Car Loans takes the hassle out of finding the best deal, helping you get your new car quickly, and at a price you can afford.
If you’re looking for your next car, let Awesome Loans help. By clicking Apply Now, you can start looking for the best finance deal for you. We’ll take the hassle out of finding a car loan and find you the best deal. What are you waiting for? Let us help you find the right car loan today.
