When to Buy a Vehicle

Lots of Car or a Car Lot? Image courtesy of Creativity103 http://www.flickr.com/photos/creative_stock/3436598429/

It is common wisdom that one should strike while the iron is hot, but when is the right time to buy a new vehicle?  The answer is hard to define, but let’s look at the typical times that are considered to be prime buying periods and how they actually look from different vantage points that all impact the auto buying and auto loan process.

End of Year Sales: Seem Great, May Not Be

The end of the year might seem like a great time to get an auto loan on a new or used vehicle, but that is only from one particular point of view.  While that point of view may be yours, it is only part of a much larger equation.  What does a car lot of person selling the vehicle think?  If they hold on to the vehicle after the year comes, they will suffer a substantial loss as the vehicle may be new but it is still not a current model year.  Older vehicles will similarly depreciate.

This is important because lenders look to have a safety net on their loan in the form of a vehicle that may be retrieved as collateral.  This means that for a loan to be acceptable, most lenders want to always be in a position to repossess the vehicle and sell it for what is owed on it or more in order to secure their interests.  A vehicle that is about to take a major loss in overall value is not something an auto lender is keen on.

Add to this the simple supply and demand curve whereby an unusually large number of loan requests increase demand while the number lenders and the money on hand for loans remains constant.  The net result is a lower acceptance rate and less than favorable terms in some cases.

Big Sales Events: Bad and Good

Big sales events are often a good balance that still experiences an altered supply and demand curve.  That being said, many new car vendors are looking to get rid of vehicle models that are not doing very well.  This means trim levels that are not proving as popular as others may be on offer for a great deal, and that could very well offset the rates and fees banks may be charging.  Remember that this is only a minor boost in demand at this time, so if the feature sets are what you are looking for then get started on your auto loan app right away.

Buying Local = Bad Idea

Remember that buying local is not the way to go 99.9% of the time.  So, where should you look?  The answer is simple: the entire country!  That might seem like a real chore until you consider the power of the Internet.  The Internet is the single fastest way to search an entire country full of bargains all at one time.  Leverage the power of the Internet to find the best deal on exactly what you want when you want it for the best effect.  Remember to do some homework on what you buy before you buy it, and always get a vehicle professionally inspected regardless of where you buy it.

Local Lenders Might Be Sub-Optimal

Remember that regardless of where you go to find a vehicle that you are never land locked when it comes to getting a loan.  Just like shopping online for vehicles, using an online auto loan application to shop for lenders from coast to coast in order to maximize your chances of finding a great loan at a great rate with a much lower chance of outright rejection.  Remember that a little planning and credit repair can both do wonders for getting accepted and being the recipient of excellent rates and loan terms.

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