While buying a car we often get confused about choosing the option between car finance and simple cash. You may also wonder whether car finance is better than cash or vice versa. Here we have tried to remove your confusion.

If you want to hear a straightforward answer, we will recommend car finance while purchasing a new car. Even if you are lucky enough to have the full amount in cash, it is better to go on car finance. If you want to know the reason you have to go through the article. We will try to explain it.

Car Finance
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Sometimes we think that it is better to buy a car with cash. Especially when the interest rate is comparatively lower. Rather than using manufacturer or dealer finance, we prefer to go with cash.

Buying a car with cash

Purchasing a car with cash is straightforward. You just have to discuss the discount with the dealer. You don’t have to bother about the interest rate or any other financial details. You have to pay a certain amount as a deposit and need to fix the monthly payment. 

Car buying
Credit: nerdwallet

Additionally, buying a car with cash may save you from paying a higher rate than the list price. Because many dealers charge some interest rate and at the end of the day you have to pay a higher price than the discounted figure the sales staff offered.

Furthermore, you can own the car just after taking the delivery of it. It might be the biggest advantage of buying a car with cash. Because when you go with car finance, you need to wait until the completion of the finance agreement to get ownership of your car. You have to sign a personal contract purchase deal too.

Credit: moneycrashers
Taking out a finance deal

Recent research unveiled that you can enjoy 14% less price while purchasing a new car with a finance deal. So, it is better off to apply for car finance to buy a new car. That’s why car manufacturers and dealers are making ties with car finance so that they can provide better service to car buyers. Because the main goal of every business is to make a long-term relationship with customers to convert them into repeat customers.