If you’ve had your eye on a used car, make sure you’re taking advantage of the best financing offers available. Many people choose to finance a used car when they have reasonably good credit but not enough money in the bank to pay cash. If this sounds like you, you’ll want to consider financing options during certain times of the year when savings rates are more attractive and used car prices drop. Here’s a closer look at some of the best times to finance a used car:
Just Before The Holiday Season
For many big-ticket items across multiple industries, demand tends to pick up starting around the end of winter, as consumers start receiving tax refund checks and as better weather makes shopping and driving easier. The automotive industry is no exception. During those months, the number of vehicle purchases often reaches its peak for the entire calendar year, as many car buyers flood the automotive market looking to spend the lump sum of money they receive from their tax returns. In typical supply and demand fashion, prices on automobiles go up, as do the interest rates associated with the purchases. That’s why the time just before the holidays is the most opportune time to beat the tax season rush and find the right car for you at the best overall value.
At Carvana, we set our market rates to be competitive and often below the average market rates for used vehicles. (In 2016, Carvana customers saved an average of $1,430 per purchase compared to Kelley Blue Book® Suggested Retail Value.) To find financing options that are completely personalized to you, check out our soft pull financing feature, which can approve you for terms that can be applied to every vehicle in our inventory in two minutes time!
When Car Loan Interest Rates Drop
If you’ve noticed interest rates are dropping this season, there’s a good chance interest rates on car loans are dropping as well. Keep an eye out for these market fluctuations so you can head over to your bank or credit union for an attractive loan offer at an opportune time.
When You Increase Your Credit Score
No matter where you decide to purchase and finance your next vehicle, your credit score will be examined to determine whether you have a good credit history. Your interest rate on a car loan or financing package is linked to your credit score — higher scores mean you can take advantage of more attractive loan offers. If you’ve done the work to clean up your credit and paid off other debts to boost your credit score, now may be a great time to shop around for used car financing offers. Just make sure you’ve had a chance to look at a copy of your credit report before you start talking to lenders so there aren’t any inaccuracies.
When Your Trade-In Has Reached Its Maximum Value
If you decide to purchase your next vehicle with Carvana, we can accept your trade-in as part of the deal; an option when you don’t want to worry about the hassle of selling your car on your own and want to lower the cost of your used car purchase. If you know your trade-in has reached an attractive market value or its maximum value given its condition, now may be a great time to explore financing a used vehicle. You can take the value of the trade-in off the sales price and then finance the rest. To discover your vehicle’s true value, use our Cardian Angel car valuation tool to ensure you’re receiving a fair offer for your vehicle.
Just visit cardianangel.com or carvana.com/trades to provide us with detailed information and answer a few questions about your vehicle. Once you’re finished, submit your information to Sebastian – your Cardian Angel – and let him and our highly sophisticated Cardian Angel algorithms go to work to discover your car’s true worth. The end result is a truly innovative video that radically redefines the trade-in process by generating a value that is uniquely and totally tailored to you. During this cutting edge review, Sebastian will guide you through how your vehicle’s value was calculated, exploring and clearly explaining the reasons why your car is worth what it is. At the end, decide if you’d like to apply the value of your car towards a new Carvana purchase, sell your car to us and receive a check in the amount of your vehicle’s value, or simply walk away from the process with us equipped with a transparent and truly accurate valuation of your automobile.
There’s no perfect time to finance a used car, but there are several times of year and situations where it makes more sense to go ahead and sign the dotted line on a car loan. Consider all of these factors when you’re in the market for a used car so you can finance your vehicle at a great rate and take advantage of price reductions.