Tips from an Auto Finance Specialist

I hate the break it to you, but the answer is probably a resounding NO!

I love new, shiny cars with all of the new features. They’re pretty and fun to drive.

They also lose a decent amount of their value as soon as you drive them off the dealer’s lot. People joke about it, but it’s 100% true.

If you have the money to buy a new car outright, or there is a feature you need that you absolutely can’t find in a used car, then fine, go with the new one.

But I’m guessing if you’re here, reading this blog, then you are at least thinking about financing your car, which means a new car probably isn’t the best move for you.

Have you ever heard of someone being upside-down in a loan or lease? Here’s how that happens: the car goes down in value faster then you can make payments on it.

And because this is super common, say goodbye to getting out of your lease or loan early without basically paying penalties (even if you’re told there are no penalties for breaking your contact early) because you owe more than the car is worth.

Instead, get a used car that’s 2+ years old. You’ll still have a lot of the newer features, and someone else will have already taken the hit on the new car depreciation.

If you get your used car from a dealer then they’ll have already cleaned it up and it will probably feel like new anyway!

If you bought it directly from the previous owner then you probably saved some money (no dealer markup, yay!) and you can use a little bit of that savings to have the car detailed so you still get the newish-car experience.

What about financing? Do you have to buy a used car outright?

If you work with a dealership then they can put together an auto loan for you, just like they would for a new car. Your payments will probably be smaller and you’ll pay less interest as a result!

If you are doing a private deal, just go to your local bank or credit union (start by talking to the institution you bank with) and ask about auto financing. Financing cars is BIG BUSINESS, so pretty much every financial institution has some sort of car loan program.

Leases might be a little harder, because a lot of leasing companies wont lease out used cars. But if you are determined to get a lease, there are some out there. I don’t know which ones, but I know they exist. Do a google search or something to find one.

Bonus: did you know it’s more eco friendly to buy a used gas car than a new electric car? Yup! Production of electric cars is actually worse for the environment than putting gas into a used car until it breaks down and needs to be replaced. Helping the environment and saving money at the same time? Yes please!