Used Car Shortages in Hamilton - Should you be Worried?

Used Car Shortages in Hamilton - Should you be Worried?

Posted on January 31, 2022

If you are wondering why there is a new and used car shortage, you are not alone. So, our car loans team are going to take a deep dive to help you understand the root causes of these shortages in Hamilton.

Covid-19 and microprocessors

When Covid-19 hit, the world was supposed to stop for 14-days to flatten the curve.

Instead, we are still battling the virus for two years, but, arguably, we are gaining ground.

All over the world, factories that produce microprocessors closed and did not reopen. When the factories reopened, there was a massive spike in demand for microprocessors that Bitcoin miners used.

This demand caused a chronic shortage of computer chips.

Car buyers across the world are now looking to buy new cars. Unfortunately, the pent-up demand for new cars did not disappear, so carmakers are scrambling to make up for lost time.

The challenge is there are not enough new cars for buyers, so buyers are forced to make a choice, wait a few months for delivery, or buy a used car from the secondary market.

Where things get complicated is the number of used cars is dropping daily, which is excellent news if you are looking to sell your used car.

However, if you are in the market for a vehicle, you will be forced to pay a premium for the used car if you can’t wait for a new one.

Low-interest rates are fuelling the buying frenzy

What has exacerbated the demand for new cars is the low-interest rates being offered for new cars.

There has never been a better time to buy a car, and if you qualify for a prime-interest rate car loan in Hamilton, you could save a considerable amount of money.

Where are you in the car buying cycle?

We covered the root cause of the lack of cars. The next thing we should discuss is where you are in the car buying cycle?

Are you seriously looking for a new vehicle right now or just kicking the proverbial tire?

If you have some time before buying a new car, you can start shopping around for a competitive interest rate. But unfortunately, you cannot find a competitive car loan online; the websites that advertise these “great deals” cannot give you the best deal.

The best source of competitive car loans is a local car dealership. This is also the place to find a great car, whether shopping for a new or used vehicle.

If you didn’t check your credit score in the last few months, you should review it before applying for a car loan. Even if your credit score is low, you can still get a car loan, but the dealership will have to work extra hard on your behalf.

When buying a car, make sure it will meet your current and projected needs for the next couple of years. The car shortage is going to last a few years, so whatever car you buy needs to meet your needs over the long term.

We’d love to help you find the perfect car loan. Simply fill in the form below and we’ll get back to you ASAP! 

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