The idea of getting a car loan isn't necessarily exciting. It means monthly payments, interest rates and years before actual ownership. But before you decide against car loans, consider these benefits that can make your life a little easier.
Extra Time
If you purchase the car in full now, that is an immediate and major dent to your savings account. However, if you qualify for a low interest rate car loan, the total amount of money you pay over your loan term will be pretty close to the actual purchase price, and you'll have the added benefit of having much more time to come up with that money. You can use the next couple of years and additional income to pay for your vehicle.
Extra Money
Using all of your available cash to purchase a car can be a big mistake. Lost liquidity could mean dire consequences. What if an emergency occurs next month? Your car can't help, but money in a savings account sure can. Or, if you invest wisely, you could see a return higher than the interest rate of your car loan, meaning that by the end of your loan term, you could have earned more money than you spent on interest.
Extra Quality
Maybe you have a few thousand dollars to put towards a car. If you use that money to purchase a car outright, you might see as little as a few months out of the vehicle before problems start arising. However, if you use that few thousand dollars as a down payment for a higher-quality car, you'll know that your money is going towards a vehicle that will be reliable for years to come. Investing in extra quality saves you from a lot of future headaches.
If you can't afford to pay in full for a new vehicle, don't fret. There are some exceptional advantages to car loans like having more time and money on your hands to pay off your new car and having a more dependable car that will last you for years to come. If these sound like benefits you would enjoy, apply for a car loan today.
