So you’ve recently relocated to the leafy streets of Hamilton, or you’re finally ready to take the plunge and buy your very own set of wheels. However, your credit score isn’t as good as it could be and you know absolutely nothing about car loans in Hamilton.
You’ve got to organise your finances and decide what you can afford, find the right dealership that can offer you the best price, and then finally make that all important decision of which car you want to commit to.
All of this can add up to a fairly daunting task, so we’ve done the legwork for you and put together a comprehensive guide on everything you need to know about car loans and cars in Hamilton.
Let’s get you on the road!
Step 1: Understand Your Finances
Perhaps the most obvious step in any large financial decision is taking an honest look at your money.
This means understand what your net income is, what your outgoing expenses are, how much you have in savings, and what you could realistically afford to work into your monthly bills and still live comfortably.
If you’ve been a super saver and have squirreled away enough money to buy your car outright, then congratulations! You can skip right ahead to picking your dream car!
But what about everyone else?
If you’re one of the many people who haven’t got such a sizeable chunk of change saved up, you’ll be looking into getting a car loan in Hamilton.
A car loan will involve regular, recurring payments towards your ownership of the car and is a great way to get into the car you want now without having to spend months saving up.
As this is a form of debt that you will now need to pay back, you need to consider how much you can really afford to pay every week or month to keep you on the road.
The average Canadian spends around $10,660 a year on private transportation, and with the average Ontarian income sitting at $52,260 a year, that’s a significant outgoing expense for anyone.
Almost 5% of all Canadians also declared bankruptcy in 2017, showing it is vital to be careful when you take on new debt.
Ensure you take into account all of your expenses and be truthful when it comes to those “harmless extras” – all those artisanal cappuccinos and midweek takeout can add up!
Once you’ve created a comprehensive snapshot of how much you could afford to part with every month, it’s time to pick out your new set of wheels.
Step 2: Research What Kind Of Car You Want
Now for the fun part – choosing your new car!
This will be a very subjective process for any potential car buyer and will depend on a wide range of factors, from where you are located to what you want to do with the car.
Whilst everyone’s decision will be unique, here are a couple of things to keep in mind when making your choice:
What Will You Be Using The Car For?
Perhaps the main consideration when looking at a new car will be what exactly you want to use it for.
Will it be a household vehicle used for shopping, picking up the kids from school and driving up to the cottage? Or will it be used more for work and construction, where storage and durability will be key?
These will all be unique to you and will require some thought over what you really need compared to what you would love to have.
How Many People Will Be Using The Car?
Another big thing to keep in mind is the number of people that will be using the car and that the car can be expected to ferry at once.
Obviously a large 6 person family with small children will need extra space for all those little bodies, whereas a young single professional could make do with a much smaller vehicle.
Try to be realistic of what your needs actually are so that you don’t end up with too much space, or not enough!
How Much Does It Cost?
Another major consideration will naturally be how much does the car you want cost to purchase outright.
The sticker price of a vehicle will certainly have an impact on how much your monthly repayments will be, and also on the length of your lease term.
We would all love to be driving around in the latest Lamborghini, but the monthly repayments would almost certainly shoot most people’s finances out of the water. Be mindful of how much the car you wish to get costs, and make sure it lines up with your financial situation and your practical needs.
Once you’ve made a decision on the car you want to drive away in, its time to have a look at your car loan options in Hamilton.
Step 3: Apply For A Loan
There are several different avenues to be aware of when looking at car loans in Hamilton.
All options will have some benefits and some drawbacks, and which one works best for you will depend on your individual circumstances.
Let’s have a look at the three big players in the car loan space.
One of the oldest institutions in the world, banks are cornerstones of every economy in the world.
These companies safeguard people’s money through government protections and investments in bonds and stocks.
Many banks offer auto loans at reasonably competitive rates that can be integrated into your online banking that you likely use every day, making repayments and checking remaining balances easy and quick.
However, if your credit score is not up to scratch, you may struggle convincing the banks to give you that car loan as they tend to be quite risk averse and have strict lending policies both internally and externally placed upon them.
Credit unions function in much the same way a bank does, in that it is an organisation that is focused on securely storing people’s money and giving them access to it when they need it.
Unlike banks, credit unions are run exclusively by their members as opposed to a team of banking executives. This means that credit unions tend to be less focused on driving up profits or potentially sneaky hidden fees and more on transparency and accountability to its members.
Credit unions also offer a range of specific car loans in Hamilton, or generic personal loans that can be used for the same purpose.
Unfortunately, credit unions will also place a fairly high amount of importance on a squeaky clean credit score to protect the interests of their constituents, so a less than stellar credit file can be a red flag for potential lenders.
Perhaps the easiest option in the pack is to simply take out a car loan with the dealership where you pick up your car directly.
This option offers convenience and instant gratification, but comes at the cost of potentially high pressure sales tactics and less than competitive interest rates.
Dealerships may be more willing to overlook poor credit scores, or have special arrangements with lenders that allow them more leeway than if you went directly to a bank.
Keep in mind, however, that these car loans will likely be less competitive than what you might receive if you shopped around at other financial institutions, and you may feel pressured into accepting a deal you’re not entirely happy with when you go into the store.
There Is Another Option…
There is a 4th option when it comes to securing a car and car loan in Hamilton. Using an auto loan broker like HamiltonBadCreditCarLoans.ca offers a range of benefits over the three traditional car loan options.
HamiltonBadCreditCarLoans.ca takes the stress out of finding the right lender at the right rate by shopping around your application to all of their trusted financial partners until they find the best deal.
What about if you have no credit or it isn’t in the best shape?
HamiltonBadCreditCarLoans.ca won’t take no for an answer when it comes to your application and will continue to search until they secure you the best possible deal for your budget and desired vehicle.
It’s as easy as applying online and letting them do the rest.
Step 4: Choose Your Car
Once you have been approved for the loan, whichever avenue you choose to go down, it’s time to actually pick out your car!
So which one is right for you?
Hopefully you will have done some research back in step 2 and have some idea of what kind of car will suit you best for life in Hamilton.
A family car with space to grow? Or a compact 2-seater for zipping around the busy city streets? That’s up to you! Where you buy your car will also depend on your circumstances, but will usually be a dealership or through car classifieds.
HamiltonBadCreditCarLoans.ca actually offers cars directly as a part of their car loan process, with over 5,000 vehicles available to choose from. Their strict reconditioning process ensures that you’re only getting the best car, and they are able to deliver right to your door in Hamilton, whenever it suits you.
Your first pick not sitting quite right? With HamiltonBadCreditCarLoans.ca, you’re free to exchange it for another one as a part of your car loan in Hamilton.
Step 5: Get On The Road!
Once you have your new set of wheels, get out there on the road! Make sure your car is properly registered and insured so that you don’t get any nasty surprises from highway patrol and enjoy!
At some point after beginning your car loan in Hamilton you may find that your situation changes, and may want to consider renegotiating the terms of your loan.
This could involve getting a better interest rate on your loan, a longer or shorter term, or switching financial providers. Don’t be afraid to shop around your options, you’re bound to save some money in the long run!