Car loans 101 WITH YESCARCREDIT.CA
START WITH THE BASICS
WHAT IS A CAR LOAN?
A car loan / auto loan is pretty much like any other. A bank or financial institution fronts you the money to buy something, and charges you a fee for borrowing. This term is typically called 'interest'. Ideally, it would be great if everyone could pay for their vehicles outright - but if you're not able to do that - you are joining majority of Canadian that need to borrow to get that dream car of yours.
TO PUT DOWN OR NOT TO PUT DOWN
You typically have two options when going through the motions of financing a vehicle. You can finance the entire mount or pay some money upfront. In a lot of scenarios, down payments are not necessary. Banks will finance with 0 money down. But, if the money is there, people will often put some money down on their new car to drive down the monthly payments, interest or time.
You need employment (usually for at least three months). Most creditors also like to see a steady income, typically at least $1500/month. When gauging income, creditors also take things into account like; government assistance, child taxes, child support and spousal support payments.
YOU NEED A BANK ACCOUNT
When you borrow money from a creditor, you have to repay it back some way. The banks require a void cheque or a pre authorized payments form so they are able to take the payments directly from your account on the days that they are due.
DO YOU HAVE A DOWN PAYMENT?
Now, don't panic. You don't necessarily need a down payment. A lot of people opt not to do so. However, if that is something that you're thinking about doing please let us know. Among the financial benefits it also shows the bank some goof faith.
You must at least the age of majority in your respective province in order to secure a loan.
A CURRENT ADDRESS
All lenders require you to have a current address to apply for lending.