Cash or Financing?

Cash or Financing in Canada

Should I get a car with cash or financing in Canada?

Getting into a car can be fun, but organizing your car finances can be difficult if you don’t have a strategy in place. When you’re buying a new car, you have two options: you can either pay cash in one go, or you can finance. Regardless of what method you opt for, there are advantages to both.

Before you start a payment plan for your next car purchase, examine these options to see what will work best for you and your budget:

1. Investing Cash

It’s common for individuals to buy used cars with cash, as they’re less expensive in price compared to new models. Many people believe that this way of car purchase is the better option because it’s simple, interest-free, and it means you don’t have to make monthly payments.

If you’re already in debt, or have trouble coping up with monthly payments, paying cash for a car is a great way to ensure that you won’t be hitting your credit by digging yourself deeper into financial jeopardy. These are just some of the benefits of buying a car with cash, however it isn’t realistic for everyone.

2. Finance

When you finance a car, you agree to the terms and conditions that they come up with, including monthly payments. These monthly payments include the interest rates and a fee that you pay to the lender for letting you borrow the money. This can be the demerit of financing. However, if you can be consistent with monthly payments, and you can find a car loan with a low interest rate, you’ll lose less money and won’t have to worry about overspending your personal savings.

3. Pay Cash and Finance

Once you’ve paid cash for a car, it’s impossible to have that money returned, and if you’re irresponsible with your auto loan, you’ll drag yourself in debt. This option is the happy medium – paying cash and taking out a small loan is a good choice for people who have some savings, but are still interested in obtaining financing. The more money you initially put down on a vehicle purchase, the less you’ll have to finance, which will also translate into lower interest rate and monthly payments.


There are payment options available for people who are in all types of financial situations, and most dealerships are happy to help regardless of what your budget might be. It’s always important to do the math before you go for a specific payment method, and it should all start with this one question: What makes the most sense for me? Interestingly, financing a car is a wiser option if you are looking to establish some credit. For individuals who have just come out of a bankruptcy or gone through a divorce or have no or bad credit in general, car financing will help them build their credit. If online car financing for bad credit seems right for you, then apply now and get approved today or call us at 1-855-550-5565.