Best car loans for recent university graduates

Best car loans for recent university graduates

Posted on August 8, 2022

Congratulations if you recently graduated from university and landed your first real job!

You are now embarking on a journey of becoming a productive member of Canadian society.

Most Canadians mark this milestone by buying a brand-new car. If you want to continue with that tradition, these tips from our Milton car loans team will help you get the best bang for your buck or, in this case, loonie.

What type of vehicle are you interested in?

The automotive world has changed dramatically in the last decade; There is no denying the climate of the world is changing; we are experiencing heat waves that have never been experienced in recorded history.

To reduce our reliance on fossil fuels and the impact it has on the environment, Canadians are opting for more efficient options like hybrids or EVs.

Even if you buy a gas-powered car, the modern ones are more efficient than anything that was produced a decade ago.

With gas prices rising and you naturally wanting to save money, you should opt for a hybrid or an EV to keep your fuel costs to a minimum.

Taking a look at your credit profile

Something that we will need to look at is your credit profile; since you just graduated from university, like most Canadians, you probably have a student loan that must be repaid.

This student loan may not appear on your credit report, but the monthly payments must be factored into your debt-to-income ratio when lenders are deciding what the maximum loan they will provide.

If you are curious, the maximum debt-to-income ratio (DTI) lenders will approve in Canada is forty percent, and that is only if you have great credit.

Look at your total pre-tax income and then multiply that amount by forty percent; the result is the maximum amount of debt you can service, including the new car loan.

Budgeting for your new car

There is more to owning a new car than just the monthly payment.

You have to factor in maintenance, insurance, and fuel. If you are driving an EV, your fuel and maintenance costs are dramatically lower than what you would pay with a gas-powered car.

You should plan on spending around one thousand dollars per month on your new car to be on the safe side.

Where to get the best deal on a new car in Milton

If you want to get a great deal, visit your local dealership and see if they know of lenders that offer discounts for university alumni.

There are lenders that provide discounts for university graduates, and the dealership can negotiate a much lower interest rate than what you could on your own.

The local dealership also takes care of all the paperwork that goes with buying a car; registering the vehicle and ordering license plates are just some of the value-added services the dealership provides.

So now would be a great time to head over to the dealership and start your car buying adventure. The sooner you go to the dealership, the sooner you will have a new car.

Contact Unique Chrysler for help, advice and competitive Milton car finance and leasing.

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