Honda is one of the most popular automakers in Canada thanks to the reliability and affordability of its models. That said, you’re still looking at spending a few thousand dollars to buy a Honda, whether you buy new or used. For many Canadians, financing is a must. Find out how you can finance your Honda in Canada.
Key Points
- Hondas are among the more popular car brands in Canada, thanks to their relatively affordable price points and reliability.
- Despite the competitive prices of Hondas, you may need to take out a loan to cover the cost, whether through a traditional car loan or a personal loan.
- Financing for Hondas is available directly from Honda, banks and credit unions, and private lenders.
How To Finance A Honda In Canada
If you need some financial assistance to buy a Honda, you’ve got a few options. Here are a few different types of auto financing possibilities available to you:
Honda Dealership Car Loan
The most convenient option when it comes to financing a Honda would be to apply for a car loan directly through the carmaker’s authorized dealership. This is the fastest option and allows you to take care of the purchase and loan arrangement in one stop.
Financing is available directly through Honda Financial Services, with special offers advertised by your local Honda dealership, such as a low introductory rate, cashback bonuses, added features, or low down payment options.
| Note: For a lower payment, you can also lease a Honda instead. This way, you can benefit from a new vehicle every couple of years, along with slightly lower monthly payments compared to financing. You can arrange a lease contract directly through Honda Financial Services. |
Finance A Honda Through A Bank Car Loan
When you need a loan to finance the purchase of a Honda, your bank might be the first place you think of.
Request Bank Financing At A Partnered Dealership
Whether you’re buying new or used, you can apply for bank financing directly at the dealership. Banks and car dealers often partner with each other to allow consumers to buy and apply for financing in one stop. In this case, you would complete the loan application process for bank financing with the dealer after finalizing a deal for a car.
Private Party Auto Loan
With a private party car loan, you’ll apply for a lump sum of money to cover the price of the vehicle from your bank. Then, you’ll make regular installment payments to your bank until the loan is repaid by the end of the loan term.
Keep in mind, however, that banks typically require that you have a healthy credit score and financial profile to get approved for a car loan. If your finances and credit are in good shape, you can take advantage of competitive interest rates on your car loan when compared to what alternative lenders can offer.
Further, banks may have certain restrictions before providing a private party auto loan. More specifically, the bank may not finance the cost of a car over a certain age, mileage. There may also be caps on loan amounts for used cars.
With a private party auto loan from a bank, you can essentially shop like a cash buyer and purchase a used vehicle from a private seller in an all-cash deal.
Learn more: Private Party Auto Loans
Can I Get A Private Car Loan To Finance A Honda?
Yes, you can get a private car loan to finance the purchase of a Honda, whether new or used. While this option is available to consumers with solid credentials, it may be particularly suitable for bad credit borrowers or those with poor finances. That’s because private car loans typically come with loan requirements that are not as strict as those that come with traditional bank financing.
You can apply for a private car loan directly with the Honda dealership or through the lender. Like a bank car loan, you can access competitive interest rates, especially if you have good credit and strong finances. You may also be able to access loan terms as long as 96 months to help keep your monthly loan payments affordable.
| Amount | Interest | Term (Months) | ||
|---|---|---|---|---|
 | $500 - $50,000 | Up to 35% | 12 - 84 | Learn more |
 | $7,500+ | Varies | 24 - 96 | Learn more |
 | $500 - $35,000 | Starting at 29.99% | 9 - 60 | Learn more |
 | $500 - $10,000 | 12.99% - 34.99% | 9 - 60 | Learn more |
 | $5,000 - $40,000 | Varies | 12 - 72 | Learn more |
 | $5,000 - $45,000 | 4.90 % - 29.95% | 36 - 72 | Learn more |
 | Varies | 11.9% + | 12 - 84 | Learn more |
 | Up to $50,000 | Varies | 12 - 84 | Learn more |
Honda Car Financing: How To Qualify
While different types of lenders may have their own loan criteria for borrowers to meet, the following factors can increase your chances of getting approved for a Honda finance with a lower rate and favourable loan terms:
- Good Credit Score: Lenders typically look at your credit score to determine your creditworthiness when assessing your loan application. A high credit score means you’ve been responsible with bill payments in the past and are more likely to make future car loan payments on time, which reduces the lender’s risk.
- Strong Income: Your income needs to be sufficient enough to cover your monthly car loan payments.
- High Down Payment: A higher down payment will reduce your loan amount, which in turn reduces the lender’s risk. Ideally, you should aim to put down at least 10% to 20% of the car price.
| What’s considered ‘good credit’? A good credit score falls within the range of 660 to 724. Anything within this range – and ideally higher – can boost your odds of car loan approval with lower rates. You can check your credit score for free using Loans Canada CompareHub. |
Documents Required For Honda Financing
Your Honda dealer or lender will ask you for certain documents, which may include the following:
- Photo ID: You must be a Canadian resident and be the age of majority in your province or territory to qualify for an auto loan. To prove this, you’ll need to show your lender a piece of government-issued photo ID, such as your driver’s license or passport. You may also be asked for a document that proves your residency in Canada or the province you live in, which you may prove with a utility bill or rent agreement.
- Income And Employment Information: You’ll need to demonstrate a sufficient income and stable employment to secure a loan to finance your Honda. Your lender may want to see bank statements, pay stubs, and an employment letter to prove your income and employment.
- Banking Information: You’ll need an active chequing account that’s capable of accepting direct deposits and permitting withdrawals for loan repayments. So, you may need to provide a void cheque.
- Vehicle Information: When you apply for a car loan, the lender will want to know everything about the vehicle, including the make, model, year, mileage, and condition. You can prove this information through the bill of sale.
Types Of Honda Cars You Can Finance In Canada
There are numerous Honda car models you can finance in Canada. Whether you want to buy it new or used, these are some Honda cars you can purchase:
| Honda Civic | Sedan |
| Honda Insight | Sedan |
| Honda Accord | Sedan |
| Honda CR-V | SUV |
| Honda HR-V | SUV |
| Honda Odyssey | Minivan |
| Honda Ridgeline | Truck |
What’s The Average Price Of A Honda In Canada?
New Honda vehicle prices in Canada range quite a bit, depending on the model. For example, a Honda Civic Sedan starts at $30,806, while a Honda Odyssey can start at $53,056.
Honda Car Loan Payments: How Much Will It Cost You?
The cost of your Honda financing will depend on the following factors:
- Car loan amount
- Loan term
- Interest rate
The following table illustrates how much your Honda financing could cost you, based on the 5 more popular Honda models currently available, an interest rate of 4.99%, a $5,000 down payment, and a 60-month term:
| Car Model | Price | Monthly Payment | Total Loan Cost |
| Civic Sedan | $30,806 | $486.87 | $29,212.37 |
| Accord Sedan | $41,266 | $684.22 | $41,053.08 |
| CR-V | $39,611 | $652.99 | $39,179.62 |
| Pilot | $56,486 | $971.37 | $58,282.11 |
| Odyssey | $53,056 | $906.66 | $54,399.35 |
| Don’t Forget About The Sales Tax When financing your Honda, don’t forget to budget for the sales tax. Sales tax can be paid upfront or rolled into your loan payments. The sales tax rate you’re charged will depend on the following: -The province you purchase the vehicle in -Whether the Honda you’re buying is new or used -Whether the car is being sold by a car dealership or private seller Learn more: Taxes On Cars In Canada: Dealership vs. Private Sale |
Tips To Keep Your Honda Car Loan Costs Low
To make the most of your Honda finance, consider these factors:
Loan Terms
When choosing between short or long terms to repay your loan, consider how your loan payments will fit in with your monthly budget, but also think about how much interest you’ll pay over the long run. Your loan term will have a direct impact here.
The longer your term, the lower your monthly payments, which may help make your loan more manageable. However, you’ll pay more interest over the life of the loan. On the other hand, a shorter loan term will save you money in interest over the term length, but it means making higher loan payments each month.
To help you understand how your loan term may impact your loan, let’s illustrate by comparing a 3-year versus a 6-year term, using a $25,000 loan amount and 6% interest rate:
| 3-Year Term | 6-Year Term | |
| Monthly Payment | $760.55 | $414.32 |
| Total Interest | $2,379.74 | $4,831.20 |
| Total Loan Cost | $27,379.74 | $29,831.20 |
In this example, you would save $346.23 a month with a longer loan term, but you would spend $2,451.46 more in interest.
Learn more: How To Lower Your Car Payment In Canada
Look For Discounts
Individual Honda dealerships may offer their own discounts and specials as incentives. Here are a few examples of the types of discounts that dealerships may offer to help lower the cost of a new Honda:
| Canadian Military Personnel Rebate. If you’re a member of the Canadian military, you may qualify for a $500 rebate to be applied to the purchase or lease of any new Honda model. | Learn more |
| Graduate Program. University students and recent graduates may be eligible for Honda’s Graduate Program, which offers discounts that vary by model. | Learn more |
| VIP Program. You can apply for the VIP Program to receive extra discounts on Honda models, bonuses on trade-ins, and family and friend referral bonuses. | Learn more |
Can You Finance A Honda Through A Personal Loan?
While a car loan would be an obvious choice when it comes to financing a Honda, you can also take out a personal loan to get your hands on the funds needed to make this big purchase.
A personal loan is a type of installment loan in which you’ll be given a lump sum of money that must be repaid — with interest — after a specified time. These loans can be either secured or unsecured and come in a variety of loan terms. The money can be used for just about any purpose, including buying a car.
You can apply for a personal loan from a bank, credit union, or online lender. The lender you choose will depend on your credit strength. If you have a good credit score, you’ll likely be able to get a loan from a bank. But if you have a bad credit score, you may have better luck with an online lender whose lending requirements are more flexible.
Learn more: Best Personal Loan
Final Thoughts
You have a few options when it comes to where to get a car loan to finance the purchase of a Honda. Depending on your credit profile and how quickly you want the financing process to go, you could either finance your Honda through a car dealership, a bank, credit union, or alternative lender. If you’ve got good credit and are willing to do a little comparison shopping to get the lowest rates, banks and credit unions may be great options. On the other hand, working directly with the dealership might get you on the road sooner. But if your credit score is poor, an online lender might be your best bet.
