Stop! Before You Take That Loan, Know Your Options

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The majority of drivers are going to get their hands on a car because they go down the traditional route of ownership. They sign themselves into a loan that gets them a new car, but with a long-term repayment agreement attached. But the truth is that you’re not always going to get the best deal that way. There are also some people who could very well do without another financial ball-and-chain to worry about in the long-term. If you’re looking for another way to get the wheels you need, let’s explore your options.

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Always consider used

Before buying a new car, it’s always worth looking on the used market for the same model. Even if it’s only been out of the dealership for a day, depreciation starts playing its role immediately, making the motor instantly more affordable. Of course, used cars come with their disadvantages. Unless you’re making all the essential checks and being thorough, it’s easy to miss some underlying problems. As a used car buyer, you also stand to lose less value in depreciation compared to those who buy new and get the immediate brunt of value loss at the start.

Take it out for a spin

Not everyone has the same needs, either. Some drivers might need a car 24/7, but for those who need to use it more seldom, it might be smarter not to own a car outright, but rather to get access to one when you need it. Car rental might seem like it’s only for occasional use like holidays or in case of emergency, but if you need a car once or twice a week, it can be a reliable and cheaper alternative to owning one. There are also car sharing clubs, where multiple people each pay for shared ownership of a vehicle. However, the disadvantage of using such arrangements is that there’s an increased likelihood that you’re paying for a vehicle someone else might damage.

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Take it out for a longer spin

Leasing a car is starting to grow into a more and more commonly used option. The benefits are clear. You pay less to temporarily “own” a car, and often leasing allows a driver to afford a car that might otherwise be too expensive for them. Alongside fewer upfront costs, leasing includes a single consolidated payment a month, including various costs that you might otherwise have to budget separately, making the financial management aspect of driving a lot easier.

Flash the cash

If you want to buy a new car but you’re not willing to take out a loan, have you considered taking the time to save for it? Being a cash buyer isn’t fiscally the easiest way to pay for a car but it has real benefits. Buying a car outright with cash is always cheaper than taking out a loan.

There are definitely advantages to buying through a loan, but it’s important that drivers know they always have options. Perhaps you can see one that fits your needs and your finances a little better.

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