Loan or lease? Many people don't take leasing into account as a means of car financing, and it is true that for most people a loan works better. However, don't automatically write the lease off. If you get new cars regularly, treat them well and don't drive too much, a lease may be your best car financing deal. What you are doing when you lease, is paying the difference between the showroom value of the car and what the dealer thinks it will be worth when you return it. You don't pay interest, often don't pay a down payment, and your monthly payments are lower. The main downside to this method of car financing is that you're not building up equity.
New or used? There are pros and cons to both. Interest rates are lower for new car financing, but new cars depreciate more rapidly. Obviously, a new car costs more than a used one, but there may be hidden costs in used cars, like repairs, and often the used car will not get such good gas mileage. If you are very particular about what features your car has, you will have more options with a new car, but if you aren't so picky, you are likely to save money overall if you buy a car that is a couple of years old, because cars depreciate so rapidly initially.
Types of loans. There are many options, including car financing with the dealership from which you buy your car, car financing through a bank or credit union, or taking out a home equity loan or line of credit. Stay away from car financing with credit cards. The interest rates are prohibitive. If you own a home, using your home equity is something you'll want to look into. The rates are usually low. If you don't, credit unions or banks are usually the best way to go, but don't automatically write off the dealership. Although most often, car financing with them will just get you a higher rate, occasionally they will be your best deal for car financing.
Length of loan. It goes without saying that car financing with a shorter loan will save you money on interest. Not only are you paying interest for a shorter amount of time, you can usually get a lower rate on a shorter loan as well. Car financing with a longer loan will, however, get you lower monthly payments, and long-term it can be more expensive to pay so much on your car monthly that you have to pay for other needs by incurring credit card debt. Credit card interest rates can be twice as high as those on car loans. Make sure your car financing still leaves you enough for your needs.
Be prepared, and you'll save more. Don't be afraid to shop around for the best deal, and understand your contract before you sign it. Good luck with your car financing!
Small Business Financing - Syndicated Leasing is an Equipment Leasing Company in California providing equipment leasing and financing services.
Used Truck Financing - Truck Lenders offersTruckLenders specializes in financing work trucks, construction equipment and commercial trailers.