Cash or Finance?



When buying a car, you have the option to buy the vehicle outright or to finance the car and pay off the amount over time. It is rare that someone has cash in hand ready to pay off a vehicle completely the day they sign the papers, but there are some instances where this is the case. It is easy to think that buying the vehicle outright would be the ideal scenario (if you are able) but it is not always the best circumstance.

 

If you have $10,000 in cash that you are ready to spend it may be smarter to use that as a down payment versus buying a vehicle that is only $10,000. With a large down payment and if you qualify for a low interest rate, you could easily get into a nicer or even new car.

 

Another reason to consider financing a vehicle is to boost your overall credit score. If you are trying to establish credit or trying to improve your score, financing a vehicle is a great way to do so as long as you make your payments on time.

 

There are some benefits to paying cash such as not having to pay interest, not having monthly payments, and by paying off your car entirely you will never be at risk of owing more than it’s worth. Financing versus cash all depends on your individual situation. If you would like to discuss your options with us feel free to give us a call at 828-586-0900.

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