A brand new luxurious automobile is usually considered as the status symbol in the society. Most of the people buy an automobile only for personal needs or satisfaction.
Some of the various other reasons to buy it include business needs, family needs, travel needs, and many more. You can buy a car in cash without any need to pay interest, or even lease or finance a car to pay monthly car loan installments.
According to data collected from Automobile manufacturers, most of the people finance their cars, some lease (around 20%) & a very few car buyers pay with cash.
Each payment method has its own advantages & disadvantages for auto buyers, but choosing the best payment methods to buy car will largely depend on many factors.
Some of those major factors include type of model, duration of ownership, availability of cash, as well as your credit score. Here are the best payment methods to buy car: cash, lease or finance:
(1) Buying Car In Cash
It is one of the best payment methods to buy car particularly when you have sufficient amount of cash. Paying the total cost of your brand new automobile in cash actually eliminates the interest costs & finance fees. This extra cost can otherwise add thousands of dollars to an automobile’s purchase price.
You should prefer to buy an automobile in cash instead of financing it particularly when your credit score is not good. As a bad credit score can actually result in increasing the rate of interest for your car loan. An automobile is a depreciating asset that quickly depreciates in its value with time.
Some of the advantages of buying car in cash include:
It allows auto buyers to buy only the vehicle that is easy to afford depending on the availability of funds in their bank accounts.
(b) Discounted Price
If you are buying car in cash from a small dealership or a private party then you are most likely to get discounted price for the selected model which in turn is lower than their asking price of the model.
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