Living in the suburbs of a big city has its benefits. These include a quieter life, cheaper cost of living, and just generally less commotion. However, one of the biggest downfalls is the amount of travel it can take to get around. For example, most people who live in Richmond B.C actually commute outside of Richmond to go to work.
While nearly 20% of these people will take public transit to work, the overwhelming majority (around 70%) still drive their car to work. Unfortunately, not everyone who needs a car can afford to buy one in cash. Thankfully, car loans exist and can make it fairly easy for most people to get a reliable car for wherever they need to go.
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Choosing The Right Vehicle in Richmond
So what sorts of vehicles can you get in Richmond with a car loan? Well, the good news is, there are generally no rules about the types of cars you can or cannot get when you get a car loan. The types of cars you can get with a car loan include:
- Electric cars
Just because you can technically purchase whatever vehicle you want, doesn’t mean you should. Before you even begin car shopping, it is a good idea to have a budget in place and ensure you stick to it. If not, there is a good chance you will end up overspending and finding yourself unable to pay off the loan over time.
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To prevent yourself from doing this, it is a good idea to avoid looking at cars out of your price range altogether. If you do, the temptation can be quite strong, especially if you have been approved for a larger car loan than you actually need.
Also, the types of cars you’ll have to choose from will depend on the stock at your local dealerships. Sure, you can travel to another city or town to get a car, but most people will simply shop and make the purchase in their hometown.
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Purchasing a Car With Bad Credit
So it seems quite easy to get a car loan in Richmond and the rest of the country, but what about if you have bad credit? While it is indeed easier to get a car loan with good credit, it is definitely still possible to get one even if your credit isn’t the greatest. While each lender is different, many will agree that if your credit score is less than 600 you might struggle to get a traditional car loan.
Working With The Right Lender
The first thing to try is to find the right lender. As I mentioned, every lender is different. Some may be willing to work with those who have bad credit, whereas others will not.
Save For a Large Down Payment
Next, if you want to give yourself a good chance of being approved despite your bad credit, it is a good idea to have a large down payment saved up. A larger down payment means that the lender needs to take on less risk. If you provide less risk in the form of a large down payment, they may be willing to take on the added risk of your bad credit score.
Consider Improving Your Credit
While you might want to try your luck with the above options, it can also make sense to wait until your credit is better and then apply for a car loan (check out this article for more information about improving your credit score). There are many things you can do to improve your credit, including:
- Using credit responsibly
- Making payments on time and in full
- Using a secured credit card
- Checking your credit report for errors
- Keeping old credit accounts open
Doing these things won’t make your credit improve overnight, but in a few months, you will likely see significant improvement. It is definitely a process but is well worth it in the end.
Interested in more information about credit health? Check out this infographic.
What About Trading in My Old Car?
What if you have an old car and want a new one? While you can get a car loan as normal and simply purchase a new one, you may want to consider trading your old car in. Many dealerships offer vehicle trade-ins and it can be a great way to take the costs of your new car down a little bit.
Simply put, a trade-in is where you will give your old car to the dealership and in return, they will put its value toward the purchase of a new car. However, it is important to temper your expectations. It is unrealistic to expect to get a ton of money for your trade-in, you will generally get anywhere from a few hundred up to a couple thousand. Of course, your old car also has to have some actual value for a trade-in to make sense for the dealership.
The Right Car Loan For Your Needs
Are you in need of a car loan or have any questions relating to car loans? If so, don’t hesitate to reach out to Loans Canada. We are confident we will be able to help you out.