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Things to bear in mind when buying a used car in 2022

Things to bear in mind when buying a used car in 2022

Are you thinking about buying a used car? If a new vehicle is not within your budget, then purchasing a used car may make good financial sense.

There are some important things that you must bear in mind if you want to come out ahead., as our Halton car loans team explains.

Interest rates are rising rapidly (even if you have great credit)

The Bank of Canada has just raised interest rates by 75 basis points and has indicated that more rate hikes are coming down the pike. This is of particular concern if you are like most Canadians who rely on credit.

When the Bank of Canada increases the prime interest rate, it has far-reaching implications for the entire Canadian economy.

Even if you have good credit, you are going to end up paying a higher interest rate to get financing for your used car.

Selecting the right used car for your budget

Throughout the pandemic, the prices of used cars were at unprecedented highs, but fortunately, those prices have started to come down.

Something that you will need to do is identify what your current and projected vehicle needs will be for the next couple of years.

The last thing you want to do is buy a vehicle only to realize it doesn’t meet your needs, and you have to buy another one in a year or two.

While the retail price of the used car is important, something else you will need to think about is the fuel economy of the car and the maintenance required to keep it roadworthy; these are costs that most prospective buyers overlook.

Budgeting for the purchase of the vehicle

Since inflation is having such a dramatic impact on the economy, you should revisit your budget if you haven’t worked on it in the last couple of months.

You need to look for savings that can go towards either paying down your existing high-interest consumer debt or using those funds to put towards your car payment.

In Canada, the average car payment can easily set you back $600, and that doesn’t include insurance.

You need to really pinch those pennies if you want to make sure you can comfortably afford the vehicle.

Locking down the best deal when purchasing a used car

Websites advertise the option of buying your car online and having the vehicle shipped to your front door.

While this works great when you are buying products online, a vehicle represents a significant financial commitment, and you shouldn’t go it alone.

Your best option is working with a local car dealership, one that is going to get you the best possible financing and also help you find the perfect used car for you.

The only way to know whether a car is suitable is to take it out for a test drive; this is a feature that only a local dealership can offer, so why not contact your local used car dealership today?

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

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