When you’re deciding on what type of car you’re looking to buy, one of the biggest variables to consider is the financing. The available loans differ for new and used cars. Here’s a closer look at the factors you’ll need to examine. 

How Does Financing Differ Between New & Used Cars?

You may need a certain credit score to be eligible for a new car loan, whereas there is often more flexibility for pre-owned. Generally, financing for a new car will be more expensive since the vehicle itself is pricier. With a new car, you may be able to attain a lower annual percentage rate (APR), which means your interest is often lower. On the other hand, time horizons for new car loans tend to be longer, so you can fully own a pre-owned vehicle sooner. 

Should You Get a New or Used Car?

When making a decision between new and used, you first need to look at your budget. After calculating how much money you can afford to spend on a car each year, it’s easier to see what you can afford. It’s also worth factoring in the potential resale value. Since new cars depreciate over 20% as soon as they’re driven off the lot, a used car can sometimes net you a better deal since that depreciation has already occurred.

As you look over new cars, make sure you ask how many of the special features are included in the main price and which are extras. For used cars, study the CarFax report to check the vehicle’s track record of damage. With either option, try to get pre-approved before you start shopping since having a loan in your pocket often gives you more negotiating power at a dealership.

If you’re looking for financing for a high-quality used car, get in touch with Autosource in Honolulu, HI. Serving the community for over 20 years, the locally owned car dealership offers a wide variety of car brands, ranging from Audi® to Ford®. To find out about their financing options, call (808) 597-8522, and browse their selection on their website.