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Best Car Loan – The Auto Loan You Can’t Go Wrong With

May 14th, 2009 admin Posted in Auto Loans | No Comments » 99 views

Want the best car loan? Before you get an auto loan of any kind, read this. It will not only save hundreds of dollars a month in car payments, it can change the course of your financial life.

The Best Car Loan is The One You Never Take Out

The following is going to run contrary to everything you read a about getting a vehicle loan. Most of what you read on this subject is written to convince you to take one out. This advice is different. It’s written to convince you not to get sucked into having car payments.

Following are some things to consider before buying your next car.

Assess Wants vs. Needs: Do you need a car or another car – really? Or, can you invest a few hundred dollars into your existing car and drive it for another year? Or, save up and buy a used one for a couple of thousand dollars?

This questions is designed to get you out of the mindset of, “I need a new (another) car. Most of us get it in our heads that we NEED another car, when all it is that we WANT another car.

Make Long-term Decisions: When most of us go out to buy a car, we often have a type in mind. We rarely waver from this, only looking at the kind we have our hearts set on. But, consider the following:

What if you adjusted your thinking to price instead of style, eg, “I will consider reliable cars – of any kind – within this price range.” Instead of the two-year old, almost new car for $18,000, what about a five or six year-old vehicle for $3,000 – that you save up for and buy with cash?

Look at it this way, instead of being stuck with a $400 per month car payment – plus the cost of full coverage insurance – for the next four years, you buy and walk away with no car payment. And, you save on the cost of insurance (ie, no full coverage is required, only liability in most states).

Remember, a car is only to get you from point A to point B. It doesn’t have to be fancy.

Before You Get a Car Loan, Consider That It’s One of the Worst Investments You Can Make

A vehicle loses 20-30% of its value as soon as you drive it off the lot. Would you invest in something (eg, a mutual fund, a stock, etc.) if you knew that its value would drop as soon as you bought it? Of course not.

BUT, this is exactly what you do when you get a car loan.

When you take all of this into consideration, it’s easy to see why the best car loan is the one you never take out.

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