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Car Loan Payment

To afford a new car or maintain it, especially one with a higher value has great financial commitment attached to it. A lot of people find car loans very convenient as it is a great means to own a vehicle on a flexible plan. But getting a loan is not always as easy as it seems. There are the associated hitches that come with it such as the attendant cost or qualification requirement demanded by the financing agency.

It is not always easy keeping up with the huge interest rates or monthly payment plans that some of these companies offer. This is why people are constantly in search of car loans that offer affordable or minimal interest rates and repayment plans.

This article consequently is tailored to people looking for cheaper, reasonable car financing. You’ll realize the best possible options as well as how much it costs to get an average car payment in Canada.

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Written by: Big Piggyy

Rating

3.3/5

Loan Term

14 days -60 months

Est. APR

% 390 - 445

Loan Amount

$100 - 15,000

Rating

3.3/5

Loan Term

14 days - 60 months

Est. APR

% 173.81 - 495.36

Loan Amount

$50 - $10,000

Rating

3.9/5

Loan Term

12 - 60 months

Est. APR

% 46.93

Loan Amount

$100 - $15,000

Rating

4.3/5

Loan Term

90 -150 days

Est. APR

% 26

Loan Amount

$500 - $850

Rating

4.8/5

Loan Term

6 - 60 months

Est. APR

% 19.99 - 36.99

Loan Amount

$500 - $15,000

How Do You Know A Good Car Loan Payment?

 

First off, how do you know a good car loan payment? One of the great features of a good car loan payment is that it usually comes with low interest with a very flexible monthly installment plan. Each plan is of course determined by the type and cost of the car you want to purchase. So that is one factor you need to put into consideration when looking for suitable financing.

 

Also, to get the best out of every deal is to spend only about 10 – 15% of your dispense account on any type of car payment. Doing so will make sure you have enough leverage to take care of other utilities.

 

What Is The Interest Rate On Average Of A Car Loan Payment In Canada?

 

There are various platforms that can give you an estimate of the average car loan payment in Canada. One of such platforms is Statistics Canada. As put by this research body, the average interest on a car loan in Canada costs around 4.44%. It is expected that on average, a buyer should be able to pay anything from 4 – 6% interest rate. However, this is dependent on a few factors such as the state of the car (is it new or second-hand). Also, it considers whether the interest rate on the car is fixed or varies?

 

Factors That Affect Car Loan Payment

 

Factors that affect car loan payments in Canada include the state of the vehicle as well as the type of interest rate.

 

Before you seek financing in Canada for any type of car, it is always advisable to get a cost estimate from the lending house. You can source for this online or you can speak with an agent about it face to face or over a phone call. After this is done with, you may need to consider a few more of the following factors before applying for a car loan in Canada:

 

Loan Cost

Before you apply for the loan, always have at the back of your mind that lenders are also taking a huge risk by giving you a loan. When you put that in perspective, it becomes easy to understand why you need to be careful about how you go about applying for loans.

 

Recognize also that the more money you request, the higher the risk it is for the lender. Thus, a huge car loan often incurs higher interests and longer repayment terms.

 

Terms of Engagement

The terms of engagement is also another strong determinant factor that affects your car loan payment. This includes the length of payment which is usually on a monthly or bi-monthly installment as the case may be. How the payment plan pans out can also affect the interest rate in the long run. For instance, a longer payment term usually results in smaller payment installments. But the downsides to this may be that you will incur a higher interest rate.

 

Consequently, a shorter payment term would mean a larger installment on a monthly basis but with lower interest.

 

Interest Rate

Now, you need to consider the interest rates carefully. The interest rate for a car loan in Canada is dependent on your credit score. If you have a good credit score you will always be in good standing with most lending agencies. But someone with a low or bad credit score will most likely appear like a huge credit risk. Thus, a lending agency may only consider such a person on a higher interest rate.

 

Can You Save on Your Car Loan Payment?

Yes, you can absolutely save on your car loan payment. Below are a few tips you can follow:

 

  • Always compare and contrast with various lending houses to get the best deals.
  • Be prepared to make a strong negotiation with your lender. Ask them if they can lower rates if you are willing to make a quick purchase.
  • It is always better to make a larger down-payment.
  • You can make a trade-off using an older vehicle when applying for a car loan.
  • Always go for a shorter payment plan. You get to pay a lot less on interest.

 

Final Thoughts

 

Car loan payments may come with its ups and downs. But following some of the points highlighted above can make the process a lot smoother.

 

Before making any commitment to a lending agency, it is good to know your options. Don’t forget to compare rates with as many lenders as possible. If you are working with a low budget, go for smaller financing as it is much easier to pay off. Lastly, always remember to go for a shorter payment plan. You get to save a lot more at the end of the day.

Big Piggyy

"Show me the MONEY!!!" – Jerry Maguire

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