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Car buying tips all Canadians can follow

Car buying tips all Canadians can follow

If you are thinking about buying a car, you have many choices to make, are you going to purchase a conventional, hybrid, or all-electric EV? Our focus is on helping you get the financing you need to make your car-buying dream a reality.

That’s why we asked our Hamilton auto loans team to outline some key things you need to know if you’re planning to buy a car anytime soon.

Car prices are rising faster than inflation

Inflation has been at 5% since the onset of the pandemic but the price of new and used cars are outpacing inflation, with each passing day, the cost of a new car is climbing higher so you need to start taking action before you end up being unable to buy a car at all!

How to secure new car financing

You will need to have good credit and a stable income if you hope to realize your goal of buying a new car. The majority of lenders are worried about issuing bad loans, so they have tightened their lending requirements, you will need a credit score over 680.

If your credit score falls below the 680 minimum requirement, then you will end up paying more to finance the car purchase provided you can find lenders that offer subprime car loans in Canada. (these subprime lenders do not advertise online or to the general public but we will tell you how to find them a little later on).

Your credit score can be found on free apps like Credit Karma, these free reporting services will give you an approximate score but these numbers do fluctuate we your financial obligations change. The best way to raise and keep a high credit score is by paying your bills off every month. If you missed one payment, if it was by accident then your credit score would drop making it harder to get a car loan or any other type of financing.

Documenting your income is key

Aside from having a good credit score, the lender will want to look at your income documents to confirm you make enough money to repay the loan.

These lenders will want to see your latest payslips and if you are self-employed your bank statements for the last couple of years.

Selecting the right Canadian auto loan provider

You will notice a significant number of websites online that offer auto loans but these lenders would not be a good choice. These online lenders could be here today and gone tomorrow, you need someone who is going to help you over the length of the car loan.

What you should do is contact a local car dealership and work with them.  These dealerships have been in business for many years and will continue to do so going forward.

These dealerships already know all of the prime and subprime lenders in the industry. By going with a local dealership, you will have access to the most competitive interest car loan interest rates and a great selection of cars to choose from. This is the best way to get a great deal on a new car in Canada, it may sound old school but it works.

If you need help or advice on anything to do with auto loans in Hamilton, contact Car Nation Canada today, we can help!

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