How To Love Your Car and Bad Credit Car Loans!

Mon, 01/14/2013 - 18:49 -- admin
Bad Credit Car Loan Decisions

Just think how easy it would have been to decide which car to buy when the Ford Model-T was the hottest set of wheels on the market. In today’s automotive market place there are literally hundreds of different choices of auto products. Cars, trucks, minivans, SUVs, CUVs, hybrids, diesels, two door, four door, five door, extended cab, long box, four wheel drive, two wheel drive, CVT transmission, dual clutch, tiptronic, manual; and the list is endless. It can be intimidating to decide what vehicle and what options are best matched to your needs, even for the savviest of auto enthusiasts.

Now add in the myriad of different dealers and programs available to those with good credit, bad credit or no credit and you just increased the difficulty in being able to narrow down those hundreds of choices of vehicles and dealers into your best option. What do you need to make sure that you don’t fall victim to vehicular information overload? Keep reading.

Get Educated

Being educated about any large product or service you are about to purchase is crucial to the overall success of well…any large purchase you will ever make. In this post I am focusing more on the actual car rather than bad credit car loans or leases, but because it is relevant I just can’t help myself. Throughout our website there is a very distinct and consistent theme. That theme is “make an informed decision”. That is a very key element in our program for bad credit car leasing and sales. Why? Well, it’s simple; knowing your options will increase your chances of making a smart decision based on your own needs and situation. Some of our customers have shared their stories of anxiety with needing to purchase a vehicle and feeling completely in the dark about their options. Not only did they have to decide what vehicle they needed, they also had to decide what program for financing was best for them. The allure of 100% financing sounded too good to be true and they had to find out. So they came to our site, and did something very simple; they asked questions. What did they find out? That they had different options available to them and they could be at ease that they had more than one!

Get out your Crystal Ball

It seems ridiculous but you should take a quick sneak peek into the future. How do you see your life changing in the next four or five years? The vehicles that you have been thinking of now as fitting your lifestyle may not fit your needs at all a few years down the road. Ourpriorities change over time and you have to try and provide foresight into yourvehicle needs today so that two years later you aren’t stuck between and rock and a hard place. (Or even throw your back out trying to get a baby in and outof the fancy sports coupe you bought last year before the bundle of joy arrived.)

Another thing to think about into the future is the actual car, truck, or minivan that you buy. How many kilometres are on it? It is a pivotal question. Far too often I see those dreaded 100% approved places (you can tell I really, really like them) offering high kilometre product to customers seeking bad credit car loans. High kilometre cars have severely reduced chance of making it to the end of the finance term. In many cases the terms on these high kilometre cars are over 84 months. For a used car with over 125,000 kilometres on it that is CRAZY – that is 7 years! Now let us quickly do the math for our future projection.

Average driver drives – 20,000 kilometres per year. Multiply that by the term so - 7 years =140,000 kilometres driven during the entire term of the contract. Now add the starting kilometres and you end up at 265,000 kilometres. This is precisely where some product education and your crystal ball come in handy.

On average, cars that breach 150,000 kilometres start to experience higher than normal wear and tear. Consequently they experience an increase in the frequency of required repairs to keep them on the road. Now I am not saying every car dies after the odometer reads 150,001 kilometres. I am saying that as a vehicle increases in kilometres driven, so do repair and maintenance bills naturally and usually in tandem.

(Meaning higher kilometres = higher maintenance bills and lower kilometres = lower maintenance. That is a difference of perhaps having to perform oil changes a few times a year when the car is new vs. having to replace brakes and tires after the car is driven past a certain number of kilometres*)

Okay, so what does that mean for the 100% approved car loan places and their higher than average kilometre cars? That slightly after the very 1st year of a 7 year term, the car in question that started out with 125,000 kilometres will breach 150,000 kilometres. After 3.5 years or in other words half way through the term that vehicle would have 205,000 kilometres. At that odometer reading the value of the car has bottomed out and you still owe half of the original value of the finance contract. To add insult to injury: the chances of increased cost of maintenance and repair and possibly catastrophic mechanical failure have just risen to critical levels.

What is the alternative? Well it is simple yet again! Low kilometre vehicles and shorter terms. You are still going to drive the same average kilometres. What if you had a four year lease, with a car that started out with 45,000 kilometres? You would finish out the term of the lease with an ending kilometre reading of 125,000. The same amount the 100% approved car loan place car started out with. Now which option seems better?

Rid yourself of Vehicular Vanity

We have talked about the program decision and now we will address the car. As mentioned earlier in the post there are hundreds of choices of different vehicles to buy. I like expensive looking cars. I mean who doesn’t? I love Luxurious leather, technological toys, big wheels and a throaty exhaust. I have to ask myself though, do I really need that? What I want isn’t always what I need. We confuse this principle many times a day when we make our purchases. Do I need that extra coffee today? Nope, I want it though! Do you really need that 50 inch LED TV? Nope, I want it though! In saying that, an extra cup of coffee or a big screen TV aren’t huge commitments. A vehicle purchase is not a cup of coffee or a TV and should be made with a little more care. Think about what you will need it for and put on your vehicular vanity blindfolds. Think about fuel economy and how much you will be driving. (See my earlier post 3 Healthy Habits to Save You Money on Fuel for a closer look at fuel economy) Get exactly what you need and the benefit of a useful vehicle will pay dividends to your lifestyle for years. I have a friend that loves snowboarding, mountain biking, camping and hiking and has a couple of bigger slobbery dogs. I bet you pictured a big shiny SUV and you would be wrong. He loves going on long road trips with his family and a big less than average fuel efficient SUV had him second guessing the looks over functionality. He has been sporting a nice luxurious extended minivan. Why? Because he listened to his needs, became educated on the product, used his crystal ball and stopped caring about what people would think about when he pulled up in minivan.

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