3 Situations in Which the Right Car Finance Can Help You Enormously

I have never been a big fan of taking out loans but there are some times in life when it is the only way to get something you need or want.

The three main situations in which a loan is necessary for most of us are when we buy a house, when we buy a car and if we plan to start up a new business. These are big investments which you probably don’t have the money lying around in order to fund.

If we look at the example of a car loan, there are certain situations in which getting this finance sorted out instead of trying to save up can really help you enormously.

When You Need a Car for Work  

It must be horribly frustrating to get the chance of a good job but not be able to take it because you don’t have the car you need. There are many different types of work which require you be able to drive, from obvious ones like a travelling salesperson and taxi driver to ones where you simply can’t get to the place of work on public transport. If it is potentially your first job or you have been out of employment for some time then you won’t want to see your chances scuppered because of a lack of a vehicle. In this situation it could make a lot of sense to take out a loan to get the vehicle, provided that you feel that the job is secure enough for you to feel confident about paying back the loan. A bad credit history doesn’t have to stand in your way either as sites such as MoneyBarn can help you get the finance you need even if your recent credit record isn’t as great as you would like it to be.

When Your Current Vehicle Is Past Its Best

If your current car is looking past its best then it is probably time to upgrade it. What happens, though, if you simply don’t have the cash to buy a newer one? If you need to drive for some reason then the chances are that you will just have to carry on with the old one. This could mean driving a vehicle which is unsafe or which is going to cost you a lot of money in repairs. It could also mean losing a lot of time and getting a lot of hassle if it breaks down at some point. Again, this is another occasion where you might want to look at car finance in order to be able to buy a newer model. A newer car can work out a lot better in terms of repairs costs and running costs, as well as often being more fuel efficient too. In the long run, you could find that it is a good financial decision to upgrade to a more modern car with the help of a loan.

When Your Family Grows

Finally, a growing family is another very acceptable reason to look for a new car. The arrival of a new baby is sometimes the moment when a decision has to be made to upgrade to a bigger, more sensible family car. This is a decision which some people find is difficult to make, as they have grown used to driving their current car. However, if it is in the best interests of your family then you won’t want to delay too long before going ahead. In these cases, you might be lucky and find that your current car has enough value in it for you to get a new one without spending too much extra on it. However, if you need a loan then it is worth getting it done right away and moving onto the next, exciting phase of your life with the most appropriate vehicle.

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10 Responses to 3 Situations in Which the Right Car Finance Can Help You Enormously

  1. Pauline says:

    Sometimes interests are so low the car finance is worth it too. Getting 0% or even under 3% would be ok in my book.
    Pauline recently posted..New year financial boot camp: utilities and bill check-upMy Profile

  2. I have to disagree with Pauline. Even if the interest rate is at 0% or 3%, this usually means you are purchasing a new car.

    I’d recommend a 3-5 year old car to avoid the large loss of value as soon as its driven off the new car lot.

    • Robert Bell says:

      That’s a great point Chuck. The lower interest rates are often on new cars, which tend to suffer from steep depreciation rates

  3. moneystepper says:

    If you are certain that you need to buy a car, and can obtain financing at a very low rate (under 2-3%) and are not buying new instead of used just because you can get the credit, then financing a car may be a good idea.

    However, there are many, many pitfalls to avoid:
    moneystepper recently posted..Property Price Predictions for the UK in 2014My Profile

  4. I’m not a big fan of car financing, but if I had to have a car to get to work and I didn’t have enough money to pay for one up front then I would be sure to search around for the best possible deal of car financing.
    Glen @ Monster Piggy Bank recently posted..Saving Money an Extra Dollar at a TimeMy Profile

  5. I would love to be able to pay cash for my next vehicle…..I think as a society we’ve fallen down the trap of thinking that a car is such an expensive of an item that you HAVE to finance it. Not true! Just like any other financial goal, paying cash for a vehicle just takes planning, dedication and hard work!
    Brock @CleverDude recently posted..One Simple Secret To Master LeftoversMy Profile

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