Reasons for Buying a Car on Cash Instead of Getting a Car Loan


These days, the question which is being risen in every mind is that do even the car owners lover their cars? I myself am a car lover and I say yes as an answer to this questions. There is no other explanation for this question.

Every single time I am filling an application which inquires me about my family finances, then there is always a section which asks how much I am paying for my car payment. Since I have bought my first car my answer to this question has always been zero. I have seen my colleagues and friends driving around new cars and bragging about the great terms of financing they are being offered. Financing has always been an illusion and you are actually borrowing money from the bank to purchase a car. Cash is still the king when it comes of buying a car.  There are also many people who are looking forward to sell their cars for cash. And most of them are always thinking about how much should I sell my car for?

There are some reasons why to buy a car on cash instead of signing a car financing policy. Some of the reason why you need to purchase a car on cash are listed below.

  1. Lose discounts by getting financing

Most of the automobile manufacturers attract the customers by offering them car loan of car financing policies. This is one of the oldest trick in book which is opted by these auto manufacturers and most of the people fell for this. The one thing people forget is that all these offers come for an expense of a higher price.

  1. No tax deductible

Most of the people are not aware of the fact that the auto loan is not deduct bale. This way you are charged of interest payments from your income if you are have signed a car loan policy instead you are not charged anything. But there is no deduction of over car loans. These car loan providers have created this tradition of their own.

  1. Fluctuating car loans

We all are well aware of the fact that the how the value of a car depreciates with time. There are many upside down in this business and due to this factor the car loan becomes a liability over you. So to avoid these kinds of situation you should directly go to the dealer and buy a car of your own choice at cash. At these dealer shops you can also demand for a discount.  You cannot get discount once you have got the membership or you are close to them.

  1. Paying for interest drains you finances

Once you have got into the quick sand of car finance then you would have to pay the installments every month. This way your expenditures also become high. So this factor always matters a lot. So one should avoid these kinds of circumstances and try to get a car on cash instead of buying a car by getting car finance.

While thinking about how much should I sell my car for and what things are needed to be considered before purchasing a new one then the above mentioned reasons can guide you well. Good Luck!