\u003C/span>\u003Cspan style=\"font-weight: 400;\">\u003Cbr />\u003C/span>\u003Cstrong>A simple way to look at it is:\u003Cbr />\u003Cbr />Financing = Buying a car.\u003Cbr />Leasing = Renting a car for several years.\u003C/strong>\u003Cspan style=\"font-weight: 400;\">\u003Cbr />\u003C/span>\u003Cspan style=\"font-weight: 400;\">\u003Cbr />\u003C/span>\u003Cspan style=\"font-weight: 400;\">You may have the option to finance or lease the same vehicle. Leasing the car may have lower upfront costs and lower monthly payments, but financing the same car means when you have paid it off it is yours to keep. \u003C/span>\u003Cspan style=\"font-weight: 400;\">\u003Cbr />\u003C/span>\u003Cspan style=\"font-weight: 400;\">\u003Cbr />\u003C/span>\u003Cspan style=\"font-weight: 400;\">We’ll cover the pros and cons of each option throughout this article to help you make an informed decision on what type of vehicle purchase makes the most sense for your needs and your driving habits. \u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>How does leasing a vehicle work?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">When you lease a vehicle, you make regular payments on a car over a short-fixed term (typically 2-4 years) and then return the vehicle once the lease is up. Leasing, like renting a car for a long period of time, means you only pay for the car’s value that you use. Unlike financing or owning a vehicle, you’re only required to pay for the depreciation costs of a leased car. Due to this factor, leasing a vehicle typically has a lower initial payment and lower monthly payments.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>How does financing a vehicle work?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">When you finance a vehicle, you’re entering into a contract with a lender where you agree to make payments over a set period of time with the end result of you owning the vehicle outright. Dealerships have relationships with a ton of lenders who can work with individuals facing a wide variety of financial situations. Once you’re approved for auto financing, it’s your responsibility to make all monthly payments on time and in full.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Although approval rates are often based on a borrower’s financial situation, vehicle financing is a great tool for rebuilding credit, and options to refinance and trade-in the vehicle before the loan is up are available. Once a loan term finishes, the vehicle officially belongs to the borrower. Many individuals prefer the idea of vehicle ownership over constantly paying monthly lease payments on new vehicles.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">If you decide that financing your next vehicle is the right path for you, Canada Drives makes car shopping (and financing) easy.\u003C/span> \u003Cspan style=\"font-weight: 400;\">You can \u003C/span>\u003Ca href=\"https://apply.canadadrives.ca/\">\u003Cspan style=\"font-weight: 400;\">get pre-approved\u003C/span>\u003C/a>\u003Cspan style=\"font-weight: 400;\"> for your auto loan online in minutes and we will connect you with a local dealership partner in your area who will show you all the vehicles you qualify for. All you have to do is pick the one you want and drive away!\u003Cbr />\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Finance Lease vs. Capital Lease vs. Operating Lease\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">If you are doing some research on leasing a vehicle you may come across articles that compare two different types of lease options, Finance (Capital) Lease and Operating Lease. \u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">When leasing a car, the difference between a finance lease, capital lease, and operating lease comes down to ownership, accounting treatment, and financial obligations. Here's how they apply in a car leasing scenario:\u003C/span>\u003C/p>\r\n\u003Ch3>\u003Cstrong>1. Finance Lease vs. Capital Lease (Same Thing)\u003C/strong>\u003C/h3>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">A \u003C/span>\u003Cstrong>finance lease (also called a capital lease)\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> for a car is structured more like a loan than a traditional lease. The lessee (you or a business) assumes most of the ownership risks and rewards.\u003C/span>\u003C/p>\r\n\u003Ch4>\u003Cstrong>How It Works:\u003C/strong>\u003C/h4>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">The car is recorded as an asset on your balance sheet (if a business lease).\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">Lease payments are split into principal (reducing liability) and interest (expense).\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">You typically have an option to buy the car at the end of the lease for a nominal or guaranteed amount. \u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">The lease term covers most of the car’s useful life (e.g., 4–5 years on a car with a 6-year life) and the car has no alternative use to the lessor at the end of the lease. This results in higher monthly payments as you are essentially paying for the entire value of the car over the course of the lease. \u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Ch4>\u003Cstrong>Who Uses It?\u003C/strong>\u003C/h4>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">Businesses that want to keep the car after the lease.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">Individuals who want eventual vehicle ownership rather than continuous leasing.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Ch4>\u003Cstrong>Example:\u003C/strong>\u003C/h4>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">You lease a car for 5 years with an option to buy it for $1 at the end. Since the lease transfers ownership benefits, it’s treated as a finance lease.\u003C/span>\u003C/p>\r\n\u003Ch3>\u003Cstrong>2. Operating Lease (Traditional Car Lease)\u003C/strong>\u003C/h3>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">An \u003C/span>\u003Cstrong>operating lease\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> is a typical car lease where the leasing company (lessor) retains ownership, and you return the car at the end of the lease term.\u003C/span>\u003C/p>\r\n\u003Ch4>\u003Cstrong>How It Works:\u003C/strong>\u003C/h4>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">Lease payments are treated more as rental expenses, resulting in lower leasing costs. \u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">You return the car at the end of the lease unless there's a purchase option (often at market value).\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">The lease term is usually shorter than the car's useful life (e.g., 2–4 years). This results in lower monthly payments because the lessor will be able to sell the car when you return it. \u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Ch4>\u003Cstrong>Who Uses It?\u003C/strong>\u003C/h4>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">Individuals who want a new car every few years.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">Businesses that prefer low monthly lease payments and tax benefits without ownership.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">People who drive within mileage limits (e.g., 12,000–15,000 km per year).\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Ch4>\u003Cstrong>Example:\u003C/strong>\u003C/h4>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">You lease a car for 3 years, pay a monthly fee, and return it at the end with no ownership. As mentioned above, in most cases you will have an option to purchase the vehicle at the end of your lease term. The purchase price at the end of an operating lease will be higher than the purchase price at the end of a finance lease.\u003C/span>\u003C/p>\r\n\u003Ch3>\u003Cstrong>Which One Is Right for You?\u003C/strong>\u003C/h3>\r\n\u003Cp>\u003Cstrong>Finance Lease:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> Best if you want to own the car eventually and can handle higher lease payments.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cstrong>Operating Lease:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> Best if you prefer lower monthly lease payments, flexibility, and new cars every few years.\u003C/span>\u003C/p>\r\n\u003Cdiv class=\"block-quote\">\r\n\u003Ch2>Related articles\u003C/h2>\r\n\u003Cul>\r\n\u003Cli>\u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/car-leasing-canada-guide\" target=\"_blank\" rel=\"noopener\">Car Leasing in Canada Explained\u003C/a>\u003C/li>\r\n\u003Cli>\u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/getting-out-of-your-car-loan\" target=\"_blank\" rel=\"noopener\">How to Get Out of Your Car Loan\u003C/a>\u003C/li>\r\n\u003Cli>\u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/trading-in-a-vehicle-that-isn-t-paid-off\" target=\"_blank\" rel=\"noopener\">How to Trade in a Car (Even If It Isn't Paid Off Yet)\u003C/a>\u003C/li>\r\n\u003C/ul>\r\n\u003C/div>\r\n\u003Ch2>\u003Cstrong>How is leasing different from financing?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">When you finance a car, the entire cost of the vehicle, including fees and taxes, is stretched out over the length of the term. The shorter the term length, the higher the monthly payments, and the longer the term length, the smaller the monthly payments. Although the average car loan length is roughly 6-7 years, payments for a financed vehicle will eventually end.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">With a leased vehicle, monthly payments are calculated by the vehicle’s residual value (the value of the vehicle that is leftover once the lease is finished) and the car’s total sale price. Because this number is often lower than a loan for auto financing, monthly payments when leasing a vehicle are known to be more affordable.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">However, once the term on a leased vehicle is up, you’re required to either buy-out the vehicle or return it and repeat the process. Most Canadians who choose to lease don’t buy the vehicle and instead return it for a new vehicle and new lease, which restarts a payment process. The payment cycle on a leased vehicle can be a turn-off to customers who want to own the car at the end of the term.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Leasing a vehicle is a convenient option for Canadians who aren’t interested in owning a vehicle and want lower monthly payments. The leasing process is also appealing to people who prefer changing their vehicles every few years to models that are newer and fall within the warranty period.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Although leasing a vehicle might seem financially convenient regarding lower monthly payments, over time, the cost of leasing several vehicles will eventually be higher than the cost of owning a vehicle. When you finance a vehicle, you’re given the freedom to use the car at your convenience, regardless of the mileage used. With a leased vehicle, there are set kilometre-limits, and going over these limits on a leased contract results in hefty fees.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Additionally, borrowers who finance a vehicle aren’t required to return their vehicle – once it’s paid for, it’s theirs to keep. Leasing a vehicle means you’re stuck with the car and payments until the lease is over and returning it before the lease is up can be extremely costly. For people who finance and want to return their vehicle due to financial or lifestyle changes, options, like refinancing and trading in the vehicle, are common and easy to do. When you lease, these options aren’t available to you.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Leasing companies understand that some wear-and-tear is bound to happen over the course of a leased term, however, any substantial wear & tear of a leased vehicle will come straight out of the borrower’s pocket. The difference between cost, convenience, and flexibility of leasing versus financing are major and should be researched before you decide which path to take. Other factors to note are the penalties that come alongside leasing and financing.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Leasing penalties\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Leasing companies want to ensure that borrowers will stay driving the vehicle through the duration of the term. These companies make money off your payments and put the cash towards paying off the vehicle so that they can continue leasing it. Due to this, leasing contracts typically include penalties that you won’t find when financing a vehicle.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">As mentioned earlier, there are a lot of options available for people who are financing and want to change their vehicle or their monthly rates. However, these options don’t exist with leasing.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">The penalties for terminating a car lease early could require you to pay for the remaining payments on the lease, an early termination fee or any negative equity left on the vehicle. An option for people who want to end a lease term early is to try and transfer the lease to a friend or family member. However, this option isn’t available to everyone. If you’re in a lease and want to get out early, buying out the leased car and trying to sell it yourself or trading it in could be the best option for saving as much money as possible through the turn-in process.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">If a leased car has accumulated a lot of wear & tear once the term is over, the borrower must settle with the leasing company to pay for the accidents, and these are typically resolved through the manufacturer instead of a local mechanic, which can sometimes be more expensive.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Financing penalties\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">When you agree to finance a vehicle, the vehicle is used as collateral while you’re making your monthly payments. Any late payments could result in hefty fees and increased interest rates, and any missed payments could result in repossession of the vehicle and serious credit score damage. Another financial penalty for financing is getting stuck into a lengthy contract and owing more in payments than the actual worth of the vehicle.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Vehicle finance lets you rebuild your credit score, however when you enter a financing agreement, ensure that the repayment plan fits into your budget, otherwise, you could face serious credit penalties if you can’t make your payments.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Can you lease a car in Canada with bad credit?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Yes, you can lease a car with bad credit in Canada, but it may be more challenging. Lenders and dealerships look at your credit score, income, and financial history to determine your eligibility. Here’s what you need to know:\u003C/span>\u003C/p>\r\n\u003Ch3>\u003Cstrong>Options for Leasing a Car with Bad Credit in Canada\u003C/strong>\u003C/h3>\r\n\u003Cp>\u003Cstrong>1. Go Through a Subprime Lender\u003C/strong>\u003C/p>\r\n\u003Cul>\r\n\u003Cli>\u003Cspan style=\"font-weight: 400;\">Some dealerships and financial institutions specialize in bad credit car leasing.\u003C/span>\u003C/li>\r\n\u003Cli>\u003Cspan style=\"font-weight: 400;\">Expect higher interest rates and possibly a larger down payment.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cstrong>2. Use a Cosigner\u003C/strong>\u003C/p>\r\n\u003Cul>\r\n\u003Cli>\u003Cspan style=\"font-weight: 400;\">If you have a family member or friend with good credit willing to cosign, this improves your approval chances.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cstrong>3. Make a Larger Down Payment\u003C/strong>\u003C/p>\r\n\u003Cul>\r\n\u003Cli>\u003Cspan style=\"font-weight: 400;\">A higher down payment lowers the lender’s risk and increases your approval chances.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cstrong>4. Consider a Lease Transfer (Lease Takeover)\u003C/strong>\u003C/p>\r\n\u003Cul>\r\n\u003Cli>\u003Cspan style=\"font-weight: 400;\">A lease transfer allows you to take over someone else’s lease, often with fewer credit requirements.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cstrong>5. Go for a Shorter Lease Term\u003C/strong>\u003C/p>\r\n\u003Cul>\r\n\u003Cli>\u003Cspan style=\"font-weight: 400;\">Some lenders may approve a short-term lease (12–24 months) more easily than a long-term one.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cstrong>6. Improve Your Credit Before Applying\u003C/strong>\u003C/p>\r\n\u003Cul>\r\n\u003Cli>\u003Cspan style=\"font-weight: 400;\">Paying down debts and checking your credit score (Equifax/TransUnion) can help.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cstrong>7. Get an Online Pre-approval to Weigh All Your Options\u003C/strong>\u003C/p>\r\n\u003Cul>\r\n\u003Cli>\u003Cspan style=\"font-weight: 400;\">Sites like Canada Drives have special financing programs designed for customers with lower credit scores. You can get \u003C/span>\u003Ca href=\"https://apply.canadadrives.ca/\">\u003Cspan style=\"font-weight: 400;\">pre-approved\u003C/span>\u003C/a>\u003Cspan style=\"font-weight: 400;\"> online in minutes to see what financing, lease, and vehicle options you qualify for. In some cases it may make more sense and be more affordable to finance a vehicle with bad credit than lease one.\u003C/span> \u003C/li>\r\n\u003C/ul>\r\n\u003Ch2>\u003Cstrong>What to know before buying a previously leased car\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">An off-lease vehicle is a car that was previously leased by someone but has been returned to the dealership at the end of the lease’s term. If you’re considering a pre-owned vehicle, recently leased cars have some advantages that standard used cars don’t have, improving the vehicle's resale value. Previously leased cars: \u003C/span>\u003C/p>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">tend to have less mileage\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">usually require fewer repairs and maintenance\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">These advantages are due to the leasing terms that were agreed to by the lease owner—to keep the car in good condition.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Another advantage to consider with previously leased cars is the warranty coverage. Dealerships tend to offer all sorts of extended warranties, but previously leased cars are often still covered under their original manufacturer's warranty due to the short length of most lease terms. It’s worth noting that leased cars usually qualify for manufacturer and dealership\u003C/span>\u003Ca href=\"https://www.canadadrives.ca/blog/buying-a-vehicle/are-certified-pre-owned-used-cars-better-than-regular-used-cars\"> \u003Cspan style=\"font-weight: 400;\">certified pre-owned\u003C/span>\u003C/a>\u003Cspan style=\"font-weight: 400;\"> programs too due to their well-kept condition. \u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">There are many advantages of buying a previously leased car, but that doesn’t mean you should buy the first previously leased car you find! Off-lease cars can have issues, so as with any used car you have your eye on, you should still do your research, perform a test drive, request an inspection, and get a\u003C/span>\u003Ca href=\"https://www.canadadrives.ca/blog/car-guide/free-car-history-report-avoid-getting-a-lemon-car\"> \u003Cspan style=\"font-weight: 400;\">CARFAX vehicle history report.\u003C/span>\u003C/a>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Get pre-approved today\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Get \u003C/span>\u003Ca href=\"https://apply.canadadrives.ca/\">\u003Cspan style=\"font-weight: 400;\">pre-approved for your new car\u003C/span>\u003C/a>\u003Cspan style=\"font-weight: 400;\"> today in minutes with our easy online application. We’ll connect you with a local dealership partner in your area who will show you all the vehicles you qualify for.\u003C/span>\u003C/p>","2025-02-05","/uploads/2024/6/667ca245e28d2.jpg","/uploads/2024/6/667ca2462488e.jpg","/uploads/2024/6/667ca246389d5.jpg","/uploads/2024/6/667ca24649097.jpg","Bad credit car loan leasing & buying","s3","When buying a car you have the option to lease or finance. While leasing often comes with lower monthly payments financing results in outright ownership. ","","2016-05-11 01:07:27","2025-02-05 13:57:27","Feb 5, 2025","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/6/667ca24649097.jpg","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/6/667ca246389d5.jpg","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/6/667ca245e28d2.jpg",{"id":17,"testimonial_id":13,"score":13,"url":92,"title":93,"quote":94,"body":95,"amp_body":13,"amp_verified":13,"publish_at":96,"img_thumb":97,"img_small":98,"img_medium":99,"img_large":100,"alt_text":101,"image_source":82,"seo_title":102,"seo_description":103,"seo_keywords":84,"type_id":6,"category_id":17,"user_id":104,"author":104,"deleted_at":13,"created_at":105,"updated_at":106,"category_url":20,"category_name":18,"publish_date":107,"img_large_src":108,"img_medium_src":109,"img_thumb_src":110},"getting-out-of-your-car-loan","How to Get Out of Your Car Loan","There are multiple reasons why a person might want to get out of their car loan early and there are several paths that you can choose...","\u003Cp>\u003Cspan style=\"font-weight: 400;\">Car loans can be a lifeline when buying a vehicle, but if your financial situation changes you may find yourself needing to get out of your car loan, removing the monthly auto payments from your list of expenses. If you’re considering exiting your current car loan in Canada, there are several methods to explore, each with its pros, cons, and potential impact on your credit score. This guide covers essential details about a few options to help you make an informed decision.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Car Loan Forgiveness Program\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">In Canada, there is no official \"car loan forgiveness\" program that automatically cancels or reduces your auto financing debt. Unlike student loans or certain types of government debt, auto loans are privately arranged through banks, credit unions, or dealership financing arms, so lenders generally require full repayment. However, here are some alternative solutions that could work similarly:\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cstrong>Debt Settlement\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Some lenders may be open to negotiating a debt settlement if you're in financial hardship and are unable to make your car payments on the original loan. This means they may agree to accept a lump sum payment that’s less than the total loan balance, forgiving the remainder. Debt settlement companies or a lawyer could help negotiate this, but it’s usually a last resort and will likely affect your credit. \u003C/span>\u003C/p>\r\n\u003Cp>\u003Cstrong>Refinancing\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Refinancing your car loan to reduce your interest rate or extend the term could lower your monthly payments, making it easier to manage. While this doesn’t forgive the debt, it may give you more breathing room if you’re struggling financially.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Voluntary Repossession\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Voluntary repossession (or voluntary surrender) is a process where you return the vehicle to the lender, accepting that they will resell it to recover some of the loan balance. Here’s how it works and what to consider:\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cstrong>How It Works\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: You contact the lender, arrange to return the car, and agree that they will resell it. Once the car is sold, the remaining balance on your loan, called a deficiency balance, is still owed by you. The deficiency balance is the difference between what you owe on the loan and what the lender recoups from the sale.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cstrong>Pros and Cons\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: The main benefit of voluntary repossession is avoiding the hassle of loan payments you can no longer afford. However, your credit score will still take a hit, as the repossession will be noted on your credit report. This option may be preferable to an involuntary repossession, which can be more damaging to your credit. Either way having a repossession on your credit report can make it challenging to secure financing with future lenders. \u003C/span>\u003C/p>\r\n\u003Cp>\u003Cstrong>Financial Consequences\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: If there’s a significant deficiency balance after the sale, the lender may take legal action to recover this amount, including using a collection agency. Be sure to have a clear agreement with your lender about what will happen to any remaining balance.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Can a Lawyer Help You Get Out of a Car Loan?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">In some cases, consulting a lawyer may be helpful in getting out of a car loan. Here’s how a lawyer could assist:\u003C/span>\u003C/p>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Negotiating with Lenders\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Lawyers experienced in debt or consumer rights can negotiate on your behalf, potentially helping you secure a settlement, reduced payments, or a refinancing option.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Reviewing Loan Contracts\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: In cases where the loan terms are questionable or overly harsh, a lawyer might find legal reasons for a lender to release you from the contract. If the lender didn’t provide full disclosure or included hidden fees, the lawyer might leverage these findings in the financing agreement to cancel or reduce your loan.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Debt Consolidation Advice\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Lawyers can advise on whether consolidating your debts, including your car loan, might be a viable solution. Debt consolidation loans combine multiple debts into one, often with lower interest rates, making it easier to manage monthly payments.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">While a lawyer’s services can be costly, it may be worth the expense if it helps you achieve financial relief or avoid credit damage.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>How to Get Out of a Car Loan Without Ruining Credit\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Protecting your credit score is essential when exiting a car loan. Here are some strategies to explore:\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cstrong>Sell the Car Privately\u003C/strong>\u003Cspan style=\"font-weight: 400;\">:In many cases, you may get more for your car by selling it privately than through a trade-in or dealership buyback. The extra money can help cover your auto loan balance, especially if you’re not upside-down (owing more than the car’s value).\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">If this option intrigues you, the first thing you should do is research online regarding the value of your car (the car’s market value) given its year, make, model and mileage. \u003C/span>\u003Ca href=\"https://www.canadianblackbook.com/\" target=\"_blank\" rel=\"noopener\">\u003Cspan style=\"font-weight: 400;\">Canadian Black Book\u003C/span>\u003C/a>\u003Cspan style=\"font-weight: 400;\"> should be your first port of call here. \u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">It’s your responsibility to pay off the remainder of your loan. But you might be able to transfer your loan to the buyer. Contact your lender or bank to discuss your options.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">When selling privately, it’s your job to ensure that repairs are made beforehand. Visit your mechanic to arrange any repairs, and get the vehicle detailed. If there are any repairs that the mechanic suggests but you don’t get around to, make sure that you disclose this information in the vehicle’s description. It might also be a good idea to include a \u003C/span>\u003Ca href=\"https://www.carfax.ca/\" target=\"_blank\" rel=\"noopener\">\u003Cspan style=\"font-weight: 400;\">vehicle history report\u003C/span>\u003C/a>\u003Cspan style=\"font-weight: 400;\"> so that the potential buyer can easily see if the car had any trouble in the past. \u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Remember to leverage all of the free online listing resources like \u003C/span>\u003Ca href=\"https://www.kijiji.ca/\" target=\"_blank\" rel=\"noopener\">\u003Cspan style=\"font-weight: 400;\">Kijiji\u003C/span>\u003C/a>\u003Cspan style=\"font-weight: 400;\">, Craigslist, and \u003C/span>\u003Ca href=\"https://www.facebook.com/marketplace\" target=\"_blank\" rel=\"noopener\">\u003Cspan style=\"font-weight: 400;\">Facebook Marketplace\u003C/span>\u003C/a>\u003Cspan style=\"font-weight: 400;\">, and share on your social media to reach as many people as possible and speed things up.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cstrong>Pay Off the Auto Loan Early\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: If you have the money and want to get out of the loan as soon as possible, paying off your vehicle loan in one lump sum is probably your best option.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">However, this option comes with an obvious price. In some car loan agreements, there’s a section that explains any penalties associated with an early payoff. This payoff amount will depend on what you and your current lender agreed to when discussing the terms of your contract. Therefore, you will have to pay the remaining loan principal plus the contracted payoff penalty, if there is one.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Contact your lender and request a payoff quote, you typically will have 30 to 90 days until that quote expires. Don’t request a payoff quote until you’re ready to pay back the entirety of your loan. Otherwise, you may breach the protocol that your lender has in place for an early loan exit, and it could end up costing you more in the long run.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">If you decide to get out of your car loan early by paying it all back at once, \u003C/span>\u003Ca href=\"https://www.canadadrives.ca/blog/credit/free-credit-score-vs-credit-report\">\u003Cspan style=\"font-weight: 400;\">check your credit report\u003C/span>\u003C/a>\u003Cspan style=\"font-weight: 400;\"> to ensure that the loan is marked as closed on your file.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cstrong>Read more: \u003C/strong>\u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/should-i-pay-off-my-car-loan-early\">\u003Cspan style=\"font-weight: 400;\">Should I Pay Off My Car Loan Early?\u003C/span>\u003C/a>\u003C/p>\r\n\u003Cp>\u003Cstrong>Transfer the Loan to Another Buyer\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Some lenders may allow you to \u003C/span>\u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/transferring-a-car-loan-to-another-person-in-canada\">\u003Cspan style=\"font-weight: 400;\">transfer the car loan to another person\u003C/span>\u003C/a>\u003Cspan style=\"font-weight: 400;\">. This could involve a family member, friend, or private buyer who is willing to take over your loan payments. Keep in mind that both you and the buyer will need to meet the lender’s qualifications for the transfer, this will include a credit check and is usually much easier to complete if the new buyer has a good credit score.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cstrong>Refinance to Lower Payments\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: If you’re struggling to keep up with monthly payments but don’t want to exit the auto loan entirely, refinancing could be a viable option. This involves negotiating new loan terms that reduce the monthly payment amount by extending the repayment period (adding extra payments) or securing a lower interest rate.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cstrong>Read More: \u003C/strong>\u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/how-and-when-to-refinance-car-loan\">\u003Cspan style=\"font-weight: 400;\">How to Refinance Your Car Loan, and When It's Beneficial\u003C/span>\u003C/a>\u003C/p>\r\n\u003Cdiv class=\"block-quote\">\r\n\u003Ch2>Sell your car directly to Canada Drives\u003C/h2>\r\n\u003Cp>Avoid the stress of selling your car privately! With \u003Ca href=\"https://www.canadadrives.ca/sell-my-car\">Canada Drives\u003C/a>, you can get an instant online offer for your car. If you are happy with your offer simply drop it off at a Canada Drives location near you and get paid! It's the easiest way to sell your car in Canada.\u003C/p>\r\n\u003C/div>\r\n\u003Ch2>\u003Cstrong>How to Return a Financed Car in Canada\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Returning a financed car can be tricky, as you’re still legally responsible for repaying the loan. Here are some ways to approach it:\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cstrong>Return to Dealer via Lease Buyout\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: If you leased the car and want to exit the contract, some dealerships may offer a car lease buyout option that allows you to return the leased vehicle and settle the outstanding balance. Keep in mind this could result in penalties or fees if you’re breaking the lease early.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cstrong>Trade-In for a Cheaper Vehicle\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Another strategy to consider if you want to get out of an expensive car loan is trading in your financed vehicle for something that's better suited to your budget, usually this means trading it in for a cheaper car. \u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Dealerships are very familiar with the trade-in process and will generally be happy to help you if your loan history is adequate and the car is in good condition.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">When you trade-in a vehicle with a loan, the dealer will ideally offer you enough for your trade-in that will allow you to pay off the loan balance. Then, you can start fresh with a new car, new loan, and hopefully a lower monthly payment. However, if you owe more on the car than it's worth (also known as being upside down or having negative equity), the dealer probably won't offer you enough to pay off the entire loan. The remainder of what you owe will roll over to your new car loan.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Therefore, if you're trying to trade your car to get a lower monthly payment, trading in your vehicle might not be a great idea if you're currently upside down on your car loan. You may want to wait until you owe less than the car is worth.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cstrong>Read more: \u003C/strong>\u003Ca href=\"https://www.canadadrives.ca/blog/car-guide/what-is-my-car-worth\">\u003Cspan style=\"font-weight: 400;\">How to Calculate the Trade-In Value of Your Car in 2 Minutes\u003C/span>\u003C/a>\u003C/p>\r\n\u003Cp>\u003Cstrong>Surrender the Vehicle to the Lender\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: In some cases, voluntary repossession might be your best option to get out of your current loan, as described earlier. Remember, this will still have consequences for your credit and might involve a deficiency balance.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Does Removing a Car Loan Affect Credit Score?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Exiting a car loan can affect your credit score in different ways, depending on the method you choose. Here’s what to keep in mind:\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cstrong>Early Loan Repayment\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Paying off your car loan early could have a slight impact on your credit score, as it may reduce your credit mix (the variety of loans and credit types you hold). However, this is generally minimal, and the long-term impact on your credit can be positive if you avoid any late payments or defaults.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cstrong>Refinancing the Loan\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Refinancing typically won’t hurt your credit score, but it may involve a hard credit inquiry, which could slightly lower your score temporarily. Over time, consistent payments on a refinanced loan can improve your credit.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cstrong>Repossession (Voluntary or Involuntary)\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Repossession is one of the most damaging options for your credit score and credit history, as it indicates you defaulted on your debt. The repossession will stay on your credit report for up to seven years, making it harder to qualify for future loans or credit at favorable terms.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cstrong>Loan Transfer or Sale\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: If you can sell the vehicle and fully pay off the existing loan, this could help avoid credit damage. A clean repayment history (without missed payments) will positively reflect on your credit report.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>How to Get Out of a Car Loan by Province\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">In Canada, consumer protection laws and car loan regulations vary slightly by province. Here’s a brief overview of how to handle a car loan exit depending on where you live:\u003C/span>\u003C/p>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Ontario\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Ontario has consumer protection laws that protect buyers from deceptive sales practices and misrepresentation. If you believe you were misled during the car sale, you may have grounds to challenge the loan or negotiate a settlement.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Quebec\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Quebec has stringent consumer protection laws that may allow you to cancel certain contracts if they were entered into under unfair terms. A lawyer familiar with Quebec’s consumer laws could help evaluate your options if the loan terms seem unfavorable or deceptive.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>British Columbia\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: In BC, you may have recourse if there are issues with the vehicle’s quality or if the dealership engaged in unfair practices. The BC Consumer Protection Act can provide grounds to contest a car loan under specific conditions.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Alberta\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Alberta’s laws also protect consumers from unfair practices, and the province has resources that can guide you through disputing a loan. The Alberta Consumer Protection Act might help if you were misled or if the car did not meet legal standards.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">For specific advice, consult a local consumer protection office or a legal professional in your province, as they can offer insight tailored to your jurisdiction.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Conclusion\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Getting out of a car loan in Canada is possible through several methods, but each has implications for your finances and credit score. Whether you opt for refinancing, a loan transfer, voluntary repossession, or negotiating with the lender, understanding each option’s pros and cons is essential. Consulting a lawyer or financial advisor can also help you make a choice that aligns with your long-term goals. Remember, while exiting a car loan can relieve immediate financial pressure, protecting your credit score and considering the costs involved will help you make the most informed decision.\u003C/span>\u003C/p>","2024-11-07","/uploads/2024/11/672bc2b8e2dcf.webp","/uploads/2024/11/672bc2b9a7513.webp","/uploads/2024/11/672bc2ba00449.webp","/uploads/2024/11/672bc2ba5ea7b.webp","getting out of your car loan","How to Get Out of Your Car Loan | Canada Drives","Canadians who want to get out of their current car loan have a few options including trading-in and refinancing. Discover what path is right for you!",0,"2015-11-25 07:45:25","2024-11-06 11:25:46","Nov 7, 2024","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/11/672bc2ba5ea7b.webp","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/11/672bc2ba00449.webp","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/11/672bc2b8e2dcf.webp",{"id":112,"testimonial_id":13,"score":13,"url":113,"title":114,"quote":115,"body":116,"amp_body":13,"amp_verified":13,"publish_at":117,"img_thumb":118,"img_small":119,"img_medium":120,"img_large":121,"alt_text":122,"image_source":82,"seo_title":123,"seo_description":124,"seo_keywords":84,"type_id":6,"category_id":17,"user_id":125,"author":125,"deleted_at":13,"created_at":126,"updated_at":126,"category_url":20,"category_name":18,"publish_date":127,"img_large_src":128,"img_medium_src":129,"img_thumb_src":130},1861,"transferring-a-car-loan-to-another-person-in-canada","Transferring a Car Loan to Another Person in Canada","If you find yourself in a situation where you're unable to continue making monthly auto loan payments, transferring the loan to someone else might be an appealing option.","\u003Cp>In Canada, the process of transferring a car loan can vary based on the lender, borrower qualifications, and certain legal requirements. This article will provide a comprehensive guide to transferring a car loan in Canada, with special attention to the procedures followed by some of Canada’s major banks, credit requirements, and refinancing options.\u003C/p>\r\n\u003Ch2>Can You Transfer Your Car Loan to Another Person in Canada?\u003C/h2>\r\n\u003Cp>Yes, it is possible to transfer a car loan to another person in Canada, but this process can be complex and is not universally available for all types of loans. Certain conditions must be met, and the loan transfer will be subject to approval by the lender. The individual assuming the loan must also meet the lender’s credit and income requirements. Typically the process of a loan takeover will be easier if the new borrower has a good credit score.\u003C/p>\r\n\u003Cp>Transferring a car loan essentially means that the new borrower will take on the remaining balance and monthly payments. For a lender, this involves assessing the new borrower’s financial standing and ensuring they are a suitable candidate for the loan. The current borrower is required to settle any outstanding amounts on the loan before the transfer can be completed.\u003C/p>\r\n\u003Ch2>How to Transfer a Car Loan to Another Person\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">To transfer a car loan, here are the steps typically involved:\u003C/span>\u003C/p>\r\n\u003Col>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Contact Your Current Lender\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Start by reaching out to your lender to see if they allow auto loan transfers and are willing to transfer the financed vehicle. Some lenders have strict policies against this, while others might offer transfer options under specific conditions.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Check Loan Terms\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Review the terms and conditions of your loan agreement to see if there are any stipulations regarding transfers. Some loans may have restrictions or penalties related to transfers.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Find a New Borrower\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: The new borrower must meet the lender’s criteria. This can include minimum credit score requirements, stable income, and the ability to meet monthly car loan payments.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Application and Approval Process\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: The lender will evaluate the new borrower’s financial background. This process can include a credit check, proof of employment, and possibly other financial documentation.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Complete Required Documentation\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Once approved, the lender will provide the necessary documents to formalize the transfer. Both parties may need to sign, and additional paperwork, such as a bill of sale, might be required.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Finalize Transfer and Registration\u003C/strong>: After the auto loan transfer is approved, the new borrower must re-register the vehicle with their information and set up their own auto insurance.\u003C/li>\r\n\u003C/ol>\r\n\u003Ch2>\u003Cstrong>How Does the Process Work with Major Canadian Banks?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">The process for transferring auto loans differs across financial institutions. Below is an overview of how four of the major Canadian banks—Scotiabank, RBC, BMO, and CIBC—typically handle car loan transfers:\u003C/span>\u003C/p>\r\n\u003Ch4>\u003Cstrong>Scotiabank\u003C/strong>\u003C/h4>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Scotiabank does not typically allow car loan transfers to another person. However, they do offer options to refinance a car loan, which could allow the new borrower to apply for their own loan to take over the payments. In such cases, Scotiabank would require the new borrower to go through the standard loan application process, after which they could use the funds to purchase the vehicle from the original borrower.\u003C/span>\u003C/p>\r\n\u003Ch4>\u003Cstrong>RBC (Royal Bank of Canada)\u003C/strong>\u003C/h4>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">RBC also doesn’t typically support straightforward loan transfers, but they may facilitate the process indirectly. RBC encourages clients to explore refinancing options, which would mean the new borrower would apply for their own loan. The original borrower could use the new loan’s funds to pay off their existing loan and sell the car to the new borrower. This alternative might involve some additional fees.\u003C/span>\u003C/p>\r\n\u003Ch4>\u003Cstrong>BMO (Bank of Montreal)\u003C/strong>\u003C/h4>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">BMO may consider car loan transfers under specific circumstances, but approval is subject to credit and income assessment of the new borrower. The original borrower would need to contact BMO to discuss the situation. If approved, the new borrower may need to complete a credit application and provide financial documentation.\u003C/span>\u003C/p>\r\n\u003Ch4>\u003Cstrong>CIBC\u003C/strong>\u003C/h4>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">CIBC generally does not offer direct car loan transfers. They might, however, allow refinancing or the option for the new borrower to apply for a separate loan through CIBC, effectively enabling a transfer by paying off the original loan balance. As with other banks, this approach requires the new borrower to meet all eligibility requirements and complete a full application process.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Can You Transfer a Vehicle Loan to Another Bank in Canada?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Directly transferring a car loan from one bank to another is uncommon in Canada. Instead, a similar result can be achieved through loan refinancing or taking out a new loan with a different bank or a different lender. Here’s how this alternative approach works:\u003C/span>\u003C/p>\r\n\u003Col>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Refinancing with a New Bank\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: The new borrower can apply for a car loan with another bank and, if approved, use the funds from that loan to pay off the original loan. This effectively transfers the debt to the new bank, but it may result in different terms and interest rates.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Repayment and Reapplication\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: The original borrower repays the current loan balance (loan amount), and the new borrower completes an application with the new bank. This is essentially creating a new loan rather than transferring the original.\u003C/span>\u003C/li>\r\n\u003C/ol>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">This indirect transfer process often incurs administrative fees and could lead to changes in monthly payments depending on the interest rates offered by the new lender.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Can You Transfer a Vehicle Loan to Another Person if You Have Bad Credit?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">If you have bad credit, transferring a car loan becomes more challenging, but it’s not necessarily impossible. Approval largely depends on the new borrower’s financial standing rather than the current borrower’s credit score. However, some lenders may look at the overall loan history and payment records to ensure the loan is in good standing before considering a transfer.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">If the loan is in default or has a history of late payments, the lender may be more reluctant to approve the transfer.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Can You Transfer a Vehicle Loan to Another Person if They Have Bad Credit?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Lenders prioritize risk assessment when approving a car loan transfer. If the new borrower has bad credit, it will likely reduce the chances of a successful transfer. That said, lenders consider more than just credit scores; they also look at income stability and overall debt-to-income ratio. If the new borrower’s income can reliably cover the loan payments, there may still be a chance for approval, though they may face higher interest rates.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">If the new owner with poor credit has a co-signer with good credit, some lenders may be more inclined to approve the transfer.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>How Do I Transfer a Car Loan to a Family Member in Canada?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Transferring a car loan to a family member follows the same process as any other loan transfer, with the advantage that lenders may be more open to approving transfers to a close family member. Here are a few steps to streamline this process:\u003C/span>\u003C/p>\r\n\u003Col>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Contact the Lender\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Let them know you wish to transfer the loan to a family member. Some lenders may offer guidance or flexibility in family transfer cases.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Provide Necessary Documentation\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: The family member will need to submit a loan application and relevant financial documents.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Consider Co-Signing\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: If the family member does not meet the credit or income requirements alone, co-signing the loan could be a solution. In this case, the original borrower would remain partially responsible for the loan.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Finalize the Transfer\u003Cspan style=\"font-weight: 400;\">: Complete any paperwork required by the lender to formalize the transfer. The family member will need to re-register the vehicle and insurance under their name.\u003C/span>\u003C/strong>\u003C/li>\r\n\u003C/ol>\r\n\u003Ch2>\u003Cstrong>Can You Refinance a Car Loan in Canada?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Yes, refinancing a car loan in Canada is a common practice and can be a viable option if you’re looking to change the loan holder. When you refinance, you essentially replace the existing loan with a new car loan, ideally at a lower interest rate or with better terms. Refinancing can also be done to transfer the loan to another person, indirectly.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Here are some reasons to consider refinancing:\u003C/span>\u003C/p>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Lower Interest Rates\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: If interest rates have decreased since you took out your previous loan, refinancing can help you secure a lower rate, reducing your monthly car payments. The best interest rate that was available for your initial loan may not be the best rate that is available to you now. Your credit score and credit report may have improved as well which could result in a lower interest rate. \u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Change Loan Terms\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: You may wish to adjust the loan term, extending or shortening it to better suit the financial needs of the new borrower.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Transfer to a New Borrower\u003Cspan style=\"font-weight: 400;\">: As previously mentioned, refinancing with a new borrower in mind allows them to pay off the original loan by assuming a new one, effectively transferring the financial responsibility.\u003C/span>\u003C/strong>\u003C/li>\r\n\u003C/ul>\r\n\u003Ch2>\u003Cstrong>Conclusion\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Transferring a car loan on a financed car in Canada is possible but requires careful planning and coordination with the lender. Each bank has specific requirements, and not all lenders support direct loan transfers. Indirect transfers through refinancing or new loan contracts are common and can be effective, provided the new borrower meets all necessary requirements.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">In summary:\u003C/span>\u003C/p>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">Major Canadian banks like Scotiabank, RBC, BMO, and CIBC typically do not allow direct transfers, but refinancing options are available.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">Transferring a loan to someone with bad credit is challenging, though not impossible, if they have strong income or a co-signer.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">Refinancing can be a practical alternative for effectively transferring a car loan to a new borrower, including family members.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">By following the steps and guidelines provided in this article, you can determine the best approach to transfer a car loan that suits both your needs and the financial institution's policies.\u003C/span>\u003C/p>\r\n\u003Cp> \u003C/p>","2024-11-01","/uploads/2024/11/6725474bbffe4.webp","/uploads/2024/11/6725474c4abee.webp","/uploads/2024/11/6725474c76626.webp","/uploads/2024/11/6725474cc3532.webp","Transferring a car loan ","Transferring a Car Loan to Another Person in Canada | Canada Drives","We review the process of transferring a car loan to someone else, how difficult it may be, and if there are alternative solutions.",39,"2024-11-01 14:25:33","Nov 1, 2024","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/11/6725474cc3532.webp","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/11/6725474c76626.webp","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/11/6725474bbffe4.webp",{"id":132,"testimonial_id":13,"score":13,"url":133,"title":134,"quote":135,"body":136,"amp_body":13,"amp_verified":13,"publish_at":137,"img_thumb":138,"img_small":139,"img_medium":140,"img_large":141,"alt_text":142,"image_source":82,"seo_title":143,"seo_description":144,"seo_keywords":84,"type_id":6,"category_id":17,"user_id":125,"author":125,"deleted_at":13,"created_at":145,"updated_at":146,"category_url":20,"category_name":18,"publish_date":147,"img_large_src":148,"img_medium_src":149,"img_thumb_src":150},1859,"understanding-apr-financing-a-comprehensive-guide","Understanding APR Financing: A Comprehensive Guide","Financing is a crucial component of many major purchases, such as homes, cars, and even everyday expenses through credit cards. When you borrow money or open a line of credit, lenders typically charge an interest rate for the service they provide.","\u003Cp>\u003Cspan style=\"font-weight: 400;\">A key concept that often comes up in these scenarios is \u003C/span>\u003Cstrong>Annual Percentage Rate (APR)\u003C/strong>\u003Cspan style=\"font-weight: 400;\">. In this article, we will explore APR in depth, explaining its meaning, how it works, and how it differs from other financial metrics like interest rates. Whether you're looking at auto loans, credit cards, or personal loans, understanding APR can help you make better financial decisions.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>What is APR on a Loan?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">APR stands for \u003C/span>\u003Cstrong>Annual Percentage Rate\u003C/strong>\u003Cspan style=\"font-weight: 400;\">, which is a measure of the cost of borrowing money (the loan’s cost). Essentially, it represents the yearly cost of taking out a loan or line of credit, expressed as a percentage. APR includes not only the interest rate charged on the loan but also other associated costs, such as fees, administrative costs, and other loan-related charges.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">The key advantage of APR is that it gives a broader, more accurate picture of the overall cost of the loan compared to just the interest rate. By law, lenders are required to disclose the APR on loans and credit cards so borrowers can easily compare different financial products and understand the true cost of borrowing.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>How Exactly Does APR Work?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">To understand how APR works, it's essential to break down the components it includes. APR is designed to show the full cost (true cost) of borrowing, so it factors in:\u003C/span>\u003C/p>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>The interest rate\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: This is the primary cost of borrowing, representing the percentage charged on the loan principal.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Additional fees and charges\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: These may include processing fees, origination fees, application fees, and other costs or expenses related to the loan.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">The APR is expressed as a percentage that is applied annually to the loan balance. It provides a standardized way to compare loans with different fee structures and terms.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Here’s how APR works in practice:\u003C/span>\u003C/p>\r\n\u003Col>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Loan Principal\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: The amount you borrow from the lender, also known as the principal loan amount, or just the loan amount.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Interest Rate\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: The percentage of the principal that the lender charges for borrowing the money.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Fees\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Various fees, such as origination or service fees, are added into the cost of the loan.\u003C/span>\u003C/li>\r\n\u003C/ol>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">The formula for APR is as follows:\u003C/span>\u003C/p>\r\n\u003Ch3>\u003Cstrong>APR = ((Interest + Fees / Loan amount) / Number of days in loan term)) x 365 x 100\u003C/strong>\u003C/h3>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">This calculation ensures that the APR reflects the true cost of the loan, including fees, over the full term. \u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Thankfully Canada requires lenders to disclose the APR details in any consumer loan agreement, so you shouldn’t have to do the math yourself.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Lenders in Canada should always provide:\u003C/span>\u003C/p>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Clear Disclosure of APR\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Lenders must provide a clear statement of the APR, which includes not only the interest rate but also any fees and charges associated with the loan.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Transparency in Loan Terms\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Lenders must disclose all relevant information, such as the total cost of the loan, repayment schedule, and any penalties for early repayment.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Details About Changes in Interest Rates\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: If a loan has a variable interest rate, the lender must inform the borrower of any rate changes and their impact on the cost of borrowing.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Ch2>\u003Cstrong>What is the Difference Between APR and Interest Rate?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Though APR and interest rate are often used interchangeably, they represent different things.\u003C/span>\u003C/p>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Interest Rate\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: The interest rate is the percentage of the loan principal charged as the cost of borrowing the money. It is the base rate you pay on the amount you borrow.\u003C/span>\u003Cspan style=\"font-weight: 400;\">\u003Cbr />\u003Cbr />\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>APR\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: The APR includes not only the interest rate but also additional costs such as fees and closing costs, giving a more comprehensive look at the total cost of the loan.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">One key distinction is that the \u003C/span>interest rate\u003Cspan style=\"font-weight: 400;\"> focuses solely on the cost of borrowing based on the loan principal, while \u003C/span>APR\u003Cspan style=\"font-weight: 400;\"> offers a more holistic view by accounting for various associated fees. This means that APR will typically be higher than the interest rate.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Types of APR\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cstrong>Fixed APR\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> and \u003C/span>\u003Cstrong>Variable APR\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> refer to two different types of interest rates that can be applied to loans, credit cards, and other forms of credit. Each has its own characteristics, advantages, and potential risks. Let’s break down the differences between the two:\u003C/span>\u003C/p>\r\n\u003Ch3>\u003Cstrong>Fixed APR\u003C/strong>\u003C/h3>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">A \u003C/span>fixed APR\u003Cspan style=\"font-weight: 400;\"> means that the interest rate remains constant throughout the life of the loan or credit agreement. It does not change based on market conditions or economic shifts. This provides \u003C/span>predictability\u003Cspan style=\"font-weight: 400;\"> and consistency for the borrower, as the monthly payments and interest costs will remain the same.\u003C/span>\u003C/p>\r\n\u003Ch4>\u003Cstrong>Key Characteristics of Fixed APR:\u003C/strong>\u003C/h4>\r\n\u003Col>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Stability\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: The rate is set at the beginning of the loan and does not change.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Predictable Payments\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: You’ll have the same interest rate and payment amount for the duration of the loan term, making it easier to plan your finances.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Protection from Rate Increases\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: A fixed APR shields you from rising interest rates in the broader economy.\u003C/span>\u003C/li>\r\n\u003C/ol>\r\n\u003Ch4>\u003Cstrong>Common Uses of Fixed APR:\u003C/strong>\u003C/h4>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Auto loans\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Most car loans have fixed APRs, so you know exactly what your monthly payments will be.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Personal loans\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Many personal loans offer fixed APRs for set loan terms.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Mortgages\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Some home loans also have fixed APRs.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Ch4>\u003Cstrong>Example of Fixed APR:\u003C/strong>\u003C/h4>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">If you take out a personal loan with a \u003C/span>fixed APR of 5%\u003Cspan style=\"font-weight: 400;\"> for five years, the APR and your monthly payments will remain at \u003C/span>5%\u003Cspan style=\"font-weight: 400;\"> for the entire loan term, regardless of any changes in economic conditions or market interest rates.\u003C/span>\u003C/p>\r\n\u003Ch4>\u003Cstrong>Pros of Fixed APR:\u003C/strong>\u003C/h4>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Predictability\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Easier to budget for payments.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Consistency\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Your rate won’t increase over time.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Less Risk\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: You're not affected by fluctuating interest rates.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Ch4>\u003Cstrong>Cons of Fixed APR:\u003C/strong>\u003C/h4>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Higher initial rates\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Fixed APRs may be higher than the starting rates of variable APRs because they provide long-term stability.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Ch3>\u003Cstrong>Variable APR\u003C/strong>\u003C/h3>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">A \u003C/span>variable APR\u003Cspan style=\"font-weight: 400;\"> means that the interest rate can change over time based on fluctuations in an underlying index, usually referred to as the \u003C/span>prime rate\u003Cspan style=\"font-weight: 400;\">. Lenders typically add a margin to the index rate to determine the total APR. When the index rate changes, your APR can either increase or decrease accordingly.\u003C/span>\u003C/p>\r\n\u003Ch4>\u003Cstrong>Key Characteristics of Variable APR:\u003C/strong>\u003C/h4>\r\n\u003Col>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Fluctuation\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: The APR changes periodically based on movements in the benchmark rate.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Lower initial rates\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Variable APRs often start lower than fixed APRs, but they can rise over time.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Risk of rate increases\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: If the benchmark rate rises, so does your APR, which can result in higher interest payments.\u003C/span>\u003C/li>\r\n\u003C/ol>\r\n\u003Ch4>\u003Cstrong>Common Uses of Variable APR:\u003C/strong>\u003C/h4>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Credit cards\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Many credit card companies have variable APRs tied to an index like the prime rate.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Adjustable-rate mortgages (ARMs)\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: These mortgages start with a fixed rate for a set period (e.g., five years) and then switch to a variable rate.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Lines of credit\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Home equity lines of credit (HELOCs) and other revolving credit lines often have variable APRs.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Ch4>\u003Cstrong>Example of Variable APR:\u003C/strong>\u003C/h4>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Suppose you have a credit card with a \u003C/span>variable APR of 14%\u003Cspan style=\"font-weight: 400;\"> based on the prime rate plus a 10% margin. If the prime rate rises by 0.5%, your APR would increase to \u003C/span>14.5%\u003Cspan style=\"font-weight: 400;\">, and you would pay more in interest.\u003C/span>\u003C/p>\r\n\u003Ch4>\u003Cstrong>Pros of Variable APR:\u003C/strong>\u003C/h4>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Potential for lower costs\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: If the index rate drops, your APR will decrease, reducing your interest payments.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Lower starting rates\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Variable APRs often have lower initial rates compared to fixed APRs.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Ch4>\u003Cstrong>Cons of Variable APR:\u003C/strong>\u003C/h4>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Unpredictability\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Payments can fluctuate, making it harder to budget for monthly expenses.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Risk of rate hikes\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: If interest rates rise, your APR can increase significantly, leading to higher payments.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Ch2>\u003Cstrong>Interest Rate vs APR Example\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Let’s look at an example to better understand the difference between interest rate and APR.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Imagine you're looking to borrow $10,000 for a car loan. Two lenders offer the following terms for 2 years:\u003C/span>\u003C/p>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Lender A\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> offers a 4% interest rate with no additional fees.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Lender B\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> offers a 3.5% interest rate but charges $300 in loan origination fees.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cstrong>Lender A\u003C/strong>\u003Cspan style=\"font-weight: 400;\">:\u003C/span>\u003C/p>\r\n\u003Cul>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">Loan amount: $10,000\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">Interest rate: 4%\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">No additional fees\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003C/ul>\r\n\u003Cul>\r\n\u003Cli aria-level=\"1\">\u003Cstrong>APR = 4%\u003C/strong>\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cstrong>Lender B\u003C/strong>\u003Cspan style=\"font-weight: 400;\">:\u003C/span>\u003C/p>\r\n\u003Cul>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">Loan amount: $10,000\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">Interest rate: 3.5%\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">Origination fee: $300\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">APR = ((Interest + Fees / Loan amount) / Number of days in loan term)) x 365 x 100\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">To find the total Interest amount you can use this formula: Loan amount x Interest rate x time period = 10,000 x 0.035 x 2 = 700\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cspan style=\"font-weight: 400;\">So APR = ((700 + 300 / 10,000) / 730)) x 365 x 100 = 5\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003C/ul>\r\n\u003Cul>\r\n\u003Cli aria-level=\"1\">\u003Cstrong>The APR for this loan is 5%\u003C/strong>\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">In this case, \u003C/span>Lender B\u003Cspan style=\"font-weight: 400;\"> has a lower interest rate but a higher APR because of the additional fees. This illustrates why APR is a more accurate representation of the total cost of the loan.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>APR Meaning for Credit Cards\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">APR is especially important in the world of credit cards. When you use a credit card, you're essentially borrowing money from the card issuer, and the APR is the cost you pay for that borrowing.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Credit card APRs typically apply to:\u003C/span>\u003C/p>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Purchases\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: The APR applied to any balance you carry from your purchases if you do not pay off your balance in full by the due date.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Balance Transfers\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: The APR applied to balances moved from one card to another.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Cash Advances\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: The APR charged when you withdraw cash using your credit card. This APR is typically higher than the purchase APR and starts accruing interest immediately.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Penalty APR\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: A higher APR charged if you miss payments or violate the terms of your credit card agreement.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">The APR on credit cards is usually variable, meaning it can change based on factors like the \u003C/span>prime rate\u003Cspan style=\"font-weight: 400;\"> or economic conditions. It's also important to note that credit card APRs can vary widely depending on your creditworthiness, so people with better credit scores will generally be offered lower APRs.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>What is a Good APR for a Car Loan?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">When it comes to car loans, a good APR varies depending on several factors, including the borrower’s credit score, the loan term, and current market conditions. If you have excellent credit, you may qualify for promotional car loan APRs, which can be as low as 0% on a new car loan. These promotions are often offered by car manufacturers to entice buyers during sales events. Available car loan interest rates also depend on whether or not the loan is for a new or used car. Typically a new car loan will have a lower APR than a used car loan. \u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Your \u003C/span>credit score\u003Cspan style=\"font-weight: 400;\"> plays a significant role in determining the \u003C/span>Annual Percentage Rate (APR)\u003Cspan style=\"font-weight: 400;\"> offered by lenders for loans, credit cards, mortgages, and other types of credit. Here’s how your credit score impacts APR:\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">With Canada Drives you can quickly see what car loan pre-approval options you qualify for. It takes less than 3 minutes to complete the \u003C/span>\u003Ca href=\"https://apply.canadadrives.ca/\">\u003Cspan style=\"font-weight: 400;\">simple online application\u003C/span>\u003C/a>\u003Cspan style=\"font-weight: 400;\">, and there is no obligation to purchase a vehicle if you change your mind.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>How does your credit score impact APR?\u003C/strong>\u003C/h2>\r\n\u003Ch3>\u003Cstrong>Higher Credit Scores Lead to Lower APRs\u003C/strong>\u003C/h3>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">When you have a higher credit score (good credit or “prime”)\u003C/span> \u003Cspan style=\"font-weight: 400;\">, lenders view you as a \u003C/span>lower-risk borrower\u003Cspan style=\"font-weight: 400;\">. This means you are more likely to pay back the loan on time, with minimal risk of defaulting. As a result, most lenders offer \u003C/span>lower APRs\u003Cspan style=\"font-weight: 400;\"> and special loan offers to individuals with strong credit scores. Lower APRs mean you pay less in interest and fees over time, making borrowing more affordable.\u003C/span>\u003C/p>\r\n\u003Ch3>\u003Cstrong>Lower Credit Scores Lead to Higher APRs\u003C/strong>\u003C/h3>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Conversely, a lower credit score (bad credit, poor credit, or “subprime”) signals to lenders that you are a \u003C/span>higher-risk borrower\u003Cspan style=\"font-weight: 400;\">, meaning there's a greater chance that you may miss payments or default on the loan. To compensate for this increased risk, most lenders charge \u003C/span>higher APRs if you have poor credit\u003Cspan style=\"font-weight: 400;\">. This allows them to make more money in interest to offset the potential risk of lending to you.\u003C/span>\u003C/p>\r\n\u003Ch3>\u003Cstrong>Improving Your Credit Score to Lower APR\u003C/strong>\u003C/h3>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">If you improve your credit score, you can often qualify for lower APRs in the future, which will help you qualify for lower monthly payments on various loan products. Here are the basic ways to improve your credit score:\u003C/span>\u003C/p>\r\n\u003Cul>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Paying off debt\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Reducing your overall debt, particularly on credit cards, can improve your credit score and lead to better APR offers.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Making on-time payments\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Consistently paying your bills on time builds your credit and shows lenders that you're a responsible borrower, reducing your risk profile and lowering your APR.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Keeping credit utilization low\u003C/strong>\u003Cspan style=\"font-weight: 400;\">: Keeping your credit card balances low relative to your credit limit (under 30%) can improve your score and result in better APR offers when applying for loans or new credit cards.\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cstrong>For more information about how credit scores work, and how you can improve your credit score visit these articles below:\u003C/strong>\u003C/p>\r\n\u003Cp>\u003Ca href=\"https://www.canadadrives.ca/blog/credit/free-credit-score-vs-credit-report\">\u003Cstrong>How to Check & Monitor Your Credit for Free in Canada\u003C/strong>\u003C/a>\u003C/p>\r\n\u003Cp>\u003Ca href=\"https://www.canadadrives.ca/blog/credit/how-long-does-it-take-to-improve-your-credit-score\">\u003Cstrong>How Long Does it Take to Improve Your Credit Score?\u003C/strong>\u003C/a>\u003C/p>\r\n\u003Cp>\u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/5-factors-that-impact-your-credit-score-in-canada\">\u003Cstrong>5 Factors that Impact Your Credit Score in Canada\u003C/strong>\u003C/a>\u003C/p>\r\n\u003Cp>\u003Ca href=\"https://www.canadadrives.ca/blog/credit/what-is-a-good-credit-score\">\u003Cstrong>What Is a Good Credit Score? (and How Can I Get One?)\u003C/strong>\u003C/a>\u003C/p>\r\n\u003Ch2>\u003Cstrong>What Does 7.99% APR Mean?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">When you see an APR of 7.99%, this means that over the course of a year, you will pay an amount equivalent to 7.99% of the loan or balance amount in interest and fees.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">For example, if you borrow $10,000 at an APR of 7.99%, over a year, you could expect to pay approximately $799. This is a simplified example, as APR is spread out over monthly payments, but it gives a general sense of the cost.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">When shopping for loans, understanding your APR helps you compare the true cost across different lenders, as they may offer similar interest rates but differ significantly when fees and other charges are included.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Conclusion\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">APR is a critical factor to consider when borrowing money, whether it's for a car loan, personal loan, mortgage, or credit card. While interest rates can tell you part of the story, APR provides a fuller picture of the cost of borrowing by including additional fees and charges. This makes APR one of the most reliable metrics for comparing different financial products.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">When evaluating loan options, it’s essential to pay attention to both the \u003C/span>interest rate\u003Cspan style=\"font-weight: 400;\"> and \u003C/span>APR\u003Cspan style=\"font-weight: 400;\"> to ensure you're making an informed decision. Comparing loan options and comparing APRS is a smart move. Making the right decision could save you hundreds, if not thousands of dollars. \u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">For credit cards, understanding your APR can help you manage debt responsibly, while for loans, a favourable APR can save you thousands of dollars over time. Ultimately, APR serves as a powerful tool to navigate the complexities of borrowing and to achieve better financial outcomes.\u003C/span>\u003C/p>","2024-09-06","/uploads/2024/9/66db7ac6a32ee.jpg","/uploads/2024/9/66db7ac76f1a4.jpg","/uploads/2024/9/66db7ac7a6afc.jpg","/uploads/2024/9/66db7ac7e7692.jpg","APR?","Understanding APR Financing: A Comprehensive Guide | Canada Drives","Annual Percentage Rate (APR) is a measure of the cost of borrowing money. We discuss how understanding APR can help you make better financial decisions.","2024-09-06 14:57:28","2024-09-06 15:05:07","Sep 6, 2024","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/9/66db7ac7e7692.jpg","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/9/66db7ac7a6afc.jpg","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/9/66db7ac6a32ee.jpg",{"id":152,"testimonial_id":13,"score":13,"url":153,"title":154,"quote":155,"body":156,"amp_body":13,"amp_verified":13,"publish_at":157,"img_thumb":158,"img_small":159,"img_medium":160,"img_large":161,"alt_text":162,"image_source":82,"seo_title":163,"seo_description":164,"seo_keywords":84,"type_id":6,"category_id":17,"user_id":125,"author":125,"deleted_at":13,"created_at":165,"updated_at":166,"category_url":20,"category_name":18,"publish_date":167,"img_large_src":168,"img_medium_src":169,"img_thumb_src":170},1856,"what-is-a-lien-on-a-vehicle","What Is a Lien on a Vehicle?","A lien registered on a vehicle is a legal claim or right that a creditor, usually a financial institution, holds against a vehicle as collateral for a loan or debt. When a car buyer finances a vehicle purchase, the lender places a lien on the car until the loan is fully paid off. \r\n","\u003Cp>\u003Cspan style=\"font-weight: 400;\">This lien ensures that the lender can repossess the vehicle if the borrower defaults on the loan terms (fails to pay the car loan bill). Understanding vehicle liens is crucial for anyone involved in buying or selling a used car, especially in Canada, where regulations can vary significantly by province or territory.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Bought a Car with a Lien on It in Canada - What Happens Now?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">If you discover that you've bought a used vehicle with a lien on it in Canada, it's important to take immediate action to address the situation. The lien represents an outstanding debt that you could be responsible for if not resolved, meaning you could be responsible for the money owed on the outstanding lien! Here’s what typically happens and what steps you should take:\u003C/span>\u003C/p>\r\n\u003Col>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Contact the Seller:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> Reach out to the seller to discuss the lien. If the seller is a dealership, they should resolve the lien as part of the sale agreement. If it's a private seller, request that they pay off the debt immediately to remove the car lien..\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Verify the Lien:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> Obtain the lender’s contact information and verify the outstanding amount. Ensure you have all the details about the lien, including how much is owed and the loan terms.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Negotiate:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> If the seller refuses to pay off the lien, you may need to negotiate a reduction in the purchase price equivalent to the lien amount or return the vehicle for a full refund.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Legal Action:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> If the seller was aware of the lien and did not disclose it, you could consider legal action for misrepresentation or fraud. When selling cars privately the seller should always disclose a car lien. \u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Pay Off the Lien:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> If no resolution is possible with the seller, you might have to pay off the lien yourself to clear the vehicle title. This step is crucial for car buyers wanting to ensure a lien-free vehicle.\u003C/span>\u003C/li>\r\n\u003C/ol>\r\n\u003Ch2>\u003Cstrong>How to Put a Lien on a Vehicle by Province\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">The process of placing a lien on a vehicle in Canada varies by province. Generally, it involves the lender registering the lien with the provincial body that governs transportation and vehicle registration or the Personal Property Registry.\u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Each province or territory has specific procedures and fees for registering a lien, and lenders must comply with these regulations to ensure their claim is legally binding.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Someone Sold Me a Car with a Lien on It Without Telling Me\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">If you bought a car with an existing lien that the seller did not disclose, you could face significant legal and financial challenges. Here's what you can do:\u003C/span>\u003C/p>\r\n\u003Col>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Contact the Seller:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> Immediately reach out to the seller and demand they pay off the lien. If the seller refuses or cannot be reached, document all your communications for potential legal action.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Legal Recourse:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> Consider filing a lawsuit against the seller for failing to disclose the lien. You may be able to recover the amount you paid for the vehicle or force the seller to pay off the lien.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Lien Holder:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> Contact the lien holder to explain the situation. They may provide options for resolving the lien, although you might still be responsible for paying it off to clear the vehicle title.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Check Provincial Laws:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> Some provinces have consumer protection laws that might offer additional recourse in cases of undisclosed liens.\u003C/span>\u003C/li>\r\n\u003C/ol>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">To avoid such situations, always check the lien status of a vehicle before purchasing, especially from a private seller.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Can Someone Put a Lien on My Car Without Me Knowing?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">In most cases, a lien cannot be placed on your vehicle without your knowledge, as it involves a formal process where the vehicle owner usually grants consent to the lien as security for a debt. However, there are exceptions:\u003C/span>\u003C/p>\r\n\u003Col>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Statutory Liens:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> These can be placed without your explicit consent, typically for unpaid taxes or fines. Government agencies have the authority to impose such liens. If you hear someone mention a tax lien this is a type of statutory lien. \u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Mechanic’s Liens:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> If you fail to pay for repairs or services on your vehicle, a mechanic or service provider may place a lien on your car for the unpaid bills.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Unpaid Debts:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> Creditors may obtain a court judgment against you and place a lien on your vehicle to secure payment of unpaid debt.\u003C/span>\u003C/li>\r\n\u003C/ol>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">If you discover an unexpected lien on your vehicle, contact the lien holder or registering agent to understand the nature of the lien and the debt it secures.\u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>Is It Illegal to Sell a Car with a Lien on It in Canada?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Selling a car with a lien on it is not illegal in Canada, but the seller is legally required to disclose the existence of the lien to the buyer. Failure to do so can result in legal consequences for the seller and financial hardship for the buyer. Here’s what you need to know:\u003C/span>\u003C/p>\r\n\u003Col>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Disclosure:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> Sellers must inform potential buyers of any existing liens on the vehicle. This transparency allows buyers to make informed decisions and negotiate accordingly.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Clear Title:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> It is common practice to clear the lien before transferring ownership. The seller can use the sale proceeds to pay off the lien, ensuring the buyer / new owner receives a free and clean title.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Legal Consequences:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> If a seller fails to disclose a lien, the buyer may have grounds for legal action based on misrepresentation or fraud.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Buyer’s Responsibility:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> Buyers should perform due diligence by checking the lien status through a vehicle history report or provincial registry before completing the purchase.\u003C/span>\u003C/li>\r\n\u003C/ol>\r\n\u003Ch2>\u003Cstrong>How Do You Check if a Vehicle Has a Lien on It in Canada?\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">To check if a vehicle has a lien on it in Canada, you can use several resources:\u003C/span>\u003C/p>\r\n\u003Col>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Carfax Canada:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> Provides a comprehensive vehicle history report that includes lien information. You can use the vehicle identification number (VIN) to obtain this report. This is particularly useful for used car buyers to ensure they are not inheriting someone else's debt.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Provincial Online Services:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> Most provinces offer online services where you can check lien status using the VIN. These services are typically available through the provincial transportation or registry office websites.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Service Providers:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> Companies that specialize in vehicle history and lien searches can provide this information for a fee.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Provincial Registry:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> You can contact the provincial registry office directly to inquire about the lien status of a vehicle. This may require a fee and specific forms.\u003C/span>\u003C/li>\r\n\u003C/ol>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Ensuring a vehicle is lien-free before purchase is crucial to avoid inheriting someone else's debt. You can visit the canada.ca website to check for car liens in your province or territory \u003Ca href=\"https://www.canada.ca/en/financial-consumer-agency/services/loans/financing-car/risks-car-liens.html\" target=\"_blank\" rel=\"noopener\">here\u003C/a>. \u003C/span>\u003C/p>\r\n\u003Ch2>\u003Cstrong>How to Remove a Lien on a Car in Canada\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Removing a lien on a car typically involves paying off the outstanding debt. Once the debt is cleared, the lender should provide a lien release document, which you then submit to the provincial body that manages vehicle registrations to update the vehicle's title to a lien-free status. Here’s a general outline of the process:\u003C/span>\u003C/p>\r\n\u003Col>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Pay Off the Debt:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> Clear any outstanding loan or debt secured by the lien. Contact the lender to obtain the exact payoff amount and ensure the debt is fully satisfied.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Obtain Lien Release:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> Get a lien release form or document from the lender. This document confirms that the debt has been paid and the lien can be removed.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Submit Documentation:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> Provide the lien release to the appropriate provincial registry to update the car title. This may involve submitting forms and paying a fee.\u003C/span>\u003C/li>\r\n\u003Cli style=\"font-weight: 400;\" aria-level=\"1\">\u003Cstrong>Update Title:\u003C/strong>\u003Cspan style=\"font-weight: 400;\"> Once the lien is removed, the registry will update the vehicle’s title to reflect its lien-free status.\u003C/span>\u003C/li>\r\n\u003C/ol>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">It’s important to keep records of all transactions and communications during this process to avoid any future disputes.\u003C/span>\u003C/p>\r\n\u003Cp> \u003C/p>\r\n\u003Ch2>\u003Cstrong>Shop with confidence with a pre-approved car loan from Canada Drives:\u003C/strong>\u003C/h2>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">If the idea of potentially getting stuck with a vehicle that has a lien on it sounds like too big of a risk you can avoid the issue altogether by purchasing a car through Canada Drives. \u003C/span>\u003C/p>\r\n\u003Cp>\u003Cspan style=\"font-weight: 400;\">Canada Drives has built a nationwide network of reputable new and used car dealerships who carry a wide variety of quality vehicles. Complete the simple \u003C/span>\u003Ca href=\"https://apply.canadadrives.ca/\">\u003Cspan style=\"font-weight: 400;\">pre-approval form\u003C/span>\u003C/a>\u003Cspan style=\"font-weight: 400;\"> online in minutes and you’ll get connected with a local dealership in your area who will show you all the vehicles you qualify for. All you have to do is pick the one you want and drive away! No stress. No worrying about potential liens! \u003C/span>\u003C/p>","2024-08-14","/uploads/2024/8/66bd15aa8780a.jpg","/uploads/2024/8/66bd15ab6de96.jpg","/uploads/2024/8/66bd15abba4ad.jpg","/uploads/2024/8/66bd15ac14370.jpg","Car being towed by a tow truck","What Is a Lien on a Vehicle? | Canada Drives","We explain vehicle liens in Canada, what they are, and what to do if you discover that a car you just bought has a lien on it.","2024-08-14 13:38:04","2024-08-14 13:45:47","Aug 14, 2024","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/8/66bd15ac14370.jpg","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/8/66bd15abba4ad.jpg","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/8/66bd15aa8780a.jpg",{"id":172,"testimonial_id":13,"score":13,"url":173,"title":174,"quote":175,"body":176,"amp_body":13,"amp_verified":13,"publish_at":177,"img_thumb":178,"img_small":179,"img_medium":180,"img_large":181,"alt_text":182,"image_source":82,"seo_title":183,"seo_description":184,"seo_keywords":84,"type_id":6,"category_id":17,"user_id":6,"author":6,"deleted_at":13,"created_at":185,"updated_at":186,"category_url":20,"category_name":18,"publish_date":187,"img_large_src":188,"img_medium_src":189,"img_thumb_src":190},546,"car-leasing-canada-guide","How To Lease a Car: Car Leasing in Canada Explained","Leasing a car can be a great alternative to other financing options if you’re not quite ready to buy. It essentially allows you to borrow a vehicle for a short-fixed duration with lower monthly and down payment costs. To avoid spending more money in the long run, it’s important to do your research and pay attention to the fine print. To help you out, we’ve compiled a guide outlining the disadvantages and benefits of leasing a car, as well as the best leasing options that will help you save money on your next vehicle. ","\u003Ch2>What is a car lease?\u003C/h2>\r\n\u003Cp>A car lease allows you to drive a brand new vehicle for a fixed period at an agreed monthly rate. Leasing doesn’t require a car loan approval or a hefty payment up front, but unlike typical financing plans, monthly lease payments go toward the \u003Cem>use\u003C/em> of the vehicle instead of the \u003Cem>ownership\u003C/em> of the vehicle. In other words, it’s essentially a long-term rental, and once the fixed lease period is over (typically between 2 to 4 years), then the customer must either return the car to the leasing company or purchase it for market value.\u003C/p>\r\n\u003Cp>Leasing a car requires a down payment and monthly payments consisting of rental charges, interest, taxes, and the depreciation costs of the vehicle over time. The interest rate and fees can vary based on the vehicle you are leasing.\u003C/p>\r\n\u003Cdiv class=\"block-quote\">\r\n\u003Ch2>Related articles\u003C/h2>\r\n\u003Cul>\r\n\u003Cli>\u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/leasing-vs-buying-what-is-best-for-you\" target=\"_blank\" rel=\"noopener\">Leasing vs. Buying: What Is Best for You?\u003C/a>\u003C/li>\r\n\u003Cli>\u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/getting-out-of-your-car-loan\" target=\"_blank\" rel=\"noopener\">How to Get Out of Your Car Loan\u003C/a>\u003C/li>\r\n\u003Cli>\u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/trading-in-a-vehicle-that-isn-t-paid-off\" target=\"_blank\" rel=\"noopener\">How to Trade in a Car (Even If It Isn't Paid Off Yet)\u003C/a>\u003C/li>\r\n\u003C/ul>\r\n\u003C/div>\r\n\u003Ch2>The pros and cons of leasing a car:\u003C/h2>\r\n\u003Ch2>\u003Cstrong>Benefits of leasing a car\u003C/strong>\u003C/h2>\r\n\u003Cp>There are plenty of benefits to leasing a new car, the main one being lower payments. The reason leasing a vehicle is beneficial is that you only pay for the depreciation of the car. Leasing is also a great option if you’re someone who struggles with commitment issues and can’t decide on a vehicle model? Or what interior to choose? A typical car lease contract only lasts 2 to 4 years and spans the early, problem-free days of a vehicle.\u003C/p>\r\n\u003Cp>Once the contract is over, you can trade in your car for an upgraded model, a new colour, or a different vehicle entirely! This comes with the added perk of always being up to date on car manufacturers’ latest features and technologies while driving a brand new car more frequently, and this gives you a shot at a fresh \u003Cspan style=\"font-weight: 400;\">manufacturer's warranty\u003C/span> every few years, which may even include \u003Cspan style=\"font-weight: 400;\">free maintenance such as\u003C/span> oil changes and servicing.\u003C/p>\r\n\u003Cp>So long as you can drive within the mileage cap outlined in your contract and avoid any major wear and tear damages to the car, you shouldn’t incur any additional fees outside of your monthly payment, regardless of the vehicle you choose.\u003C/p>\r\n\u003Ch2>\u003Cstrong>Disadvantages of leasing a car\u003C/strong>\u003C/h2>\r\n\u003Cp>Before getting too excited about the low-cost, low-commitment pros of leasing a car, it’s important to understand the cons as well. The obvious downside to leasing a car is the fact that, despite making monthly payments, you never actually own the car that you’re driving. Once the lease term ends, you’re required to return the vehicle and restart the process from scratch, with no equity to use toward the purchase of your next ride. This is the key difference between leasing and buying (or financing) a car.\u003C/p>\r\n\u003Cp>While it may be tempting to jump on an apparently low price tag at first, be careful because, in the long run, it could actually cost you more. It’s easy to get carried away in the cycle of upgrading your vehicle every 2 to 4 years, but repeatedly leasing cars over time will actually carve a deeper hole in your pocket than a one-time car purchase would, and in the end, you’ll have no vehicle to truly call your own.\u003C/p>\r\n\u003Cp>Another aspect to carefully consider is the vehicle lease contract. Every car lease contract is embedded with rather restrictive guidelines, and if you fail to follow them, you could face costly penalty fees. These guidelines may include a mileage cap, as mentioned above, which restricts you to an annual kilometre limit (typically around 25,000 km/ year) that you’re expected to stay below. If you have a long commute to work or plan on making a few road trips, then you could face steep charges at the end of your lease term. For many Canadian drivers living in rural communities this kilometre limit is a deal breaker.\u003C/p>\r\n\u003Cp>You can also expect to be charged penalty fees for dings, damages and considerable wear to the vehicle’s interior, exterior or drive performance at the lease end, whether the lease expires or you end the lease early. And, should you \u003Cem>really\u003C/em> have commitment issues and want to quit your contract before the term’s end date, be prepared to fork over whatever cash amount remains on your lease, which could be upwards of a few thousand dollars. Although seldom discussed, these additional charges are always outlined in the contract, so be sure to read it thoroughly and pay close attention to the details!\u003C/p>\r\n\u003Ch2>Who pays for insurance on a leased vehicle?\u003C/h2>\r\n\u003Cp>When you lease a car in Canada, you are responsible for paying the insurance premiums, just as you would if you were financing or owning a car outright. However, leasing companies typically have specific insurance coverage requirements, which usually include:\u003C/p>\r\n\u003Cp>\u003Cstrong>Liability Coverage:\u003C/strong> This covers bodily injury and property damage to others if you are at fault in an accident. Minimum limits are typically higher for leased vehicles.\u003Cbr />\u003Cbr />\u003Cstrong>Collision Coverage:\u003C/strong> This covers damage to your leased vehicle resulting from a collision, regardless of who is at fault.\u003Cbr />\u003Cbr />\u003Cstrong>Comprehensive Coverage:\u003C/strong> This covers damage to your leased vehicle from non-collision events such as theft, vandalism, fire, or natural disasters.\u003Cbr />\u003Cbr />\u003Cstrong>Gap Insurance:\u003C/strong> Some leasing companies may require or recommend gap insurance. Gap insurance covers the difference between the actual cash value of the vehicle and the remaining lease balance if the car is totaled or stolen.\u003Cbr />\u003Cbr />Insurance premiums for leased vehicles can be higher compared to those for financed or owned vehicles because of the higher coverage limits required.\u003C/p>\r\n\u003Cp>It’s crucial to maintain the required insurance coverage for the duration of the lease term. Failing to do so can result in penalties, additional charges, or even termination of the lease agreement by the leasing company. \u003C/p>\r\n\u003Ch2>Can you return a leased car early?\u003C/h2>\r\n\u003Cp>Yes, you can return a leased car early in Canada, but it often comes with additional costs and considerations. Here's what you need to know:\u003C/p>\r\n\u003Cp>\u003Cstrong>Early Termination Fees\u003C/strong>\u003Cbr />Most lease agreements include penalties for early termination. These fees can be substantial and might include:\u003C/p>\r\n\u003Cul>\r\n\u003Cli>Remaining lease payments\u003C/li>\r\n\u003Cli>Early lease termination fees\u003C/li>\r\n\u003Cli>Depreciation costs\u003C/li>\r\n\u003Cli>Lease-end fees such as a \u003Cspan style=\"font-weight: 400;\">lease disposition fee\u003C/span>\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cstrong>Negative Equity\u003C/strong>\u003Cbr />If the car's current market value is less than the remaining lease obligations, you may have to pay the difference, known as negative equity.\u003C/p>\r\n\u003Cp>\u003Cstrong>Lease Buyout\u003C/strong>\u003Cbr />Some lease companies allow you to buy out the lease early. This involves paying the remaining lease balance plus any early termination fees. You can then sell the car to recoup some costs, but this depends on the car’s market value.\u003C/p>\r\n\u003Cp>\u003Cstrong>Lease Transfer\u003C/strong>\u003Cbr />In some cases, you can transfer the lease to another person through a lease transfer or lease assumption. However, there may be fees associated with this transfer, and the new lessee must be approved by the lease company.\u003C/p>\r\n\u003Cp>\u003Cstrong>Trade-In\u003C/strong>\u003Cbr />Another option is to trade in the leased car when you buy or lease a new vehicle from the same dealership. The dealer might roll the remaining lease balance into the new lease or loan, but this could result in higher monthly payments.\u003C/p>\r\n\u003Ch2>Steps to return a leased car early:\u003C/h2>\r\n\u003Col>\r\n\u003Cli>\u003Cstrong>Review your lease agreement:\u003C/strong> Understand the terms, fees, and penalties for early termination.\u003C/li>\r\n\u003Cli>\u003Cstrong>Contact your leasing company:\u003C/strong> Inform them of your intention to return the car early and inquire about the specific costs involved.\u003C/li>\r\n\u003Cli>\u003Cstrong>Evaluate your options:\u003C/strong> Consider whether buying out the lease, transferring it, or trading it in makes the most financial sense.\u003C/li>\r\n\u003Cli>\u003Cstrong>Prepare the car for return:\u003C/strong> Ensure the car is in good condition to avoid additional charges for excessive wear and tear.\u003C/li>\r\n\u003Cli>\u003Cstrong>Complete the paperwork:\u003C/strong> Follow the leasing company’s process for early termination, including signing any necessary documents and paying fees.\u003C/li>\r\n\u003C/ol>\r\n\u003Cp>\u003Cstrong>Considerations\u003C/strong>\u003C/p>\r\n\u003Cul>\r\n\u003Cli>\u003Cstrong>Financial impact:\u003C/strong> Early termination can be costly. Calculate the total expenses to ensure you’re making a financially sound decision.\u003C/li>\r\n\u003Cli>\u003Cstrong>Market value:\u003C/strong> Check the car’s market value to determine if buying out the lease and selling the car privately might be a better option.\u003C/li>\r\n\u003Cli>\u003Cstrong>Credit impact:\u003C/strong> Defaulting on lease payments or returning the car without proper settlement can negatively impact your credit score.\u003C/li>\r\n\u003C/ul>\r\n\u003Ch2>Buying out a car lease in Canada\u003C/h2>\r\n\u003Cp>Buying out a car lease in Canada involves purchasing the leased vehicle either at the end of the lease term or, in some cases, before the lease term ends. Here’s a detailed guide on how the process works:\u003C/p>\r\n\u003Cp>\u003Cstrong>1. Review your lease agreement\u003C/strong>\u003Cbr />Check your current lease agreement for the buyout terms, including the residual value (the car's estimated value at the end of the lease). This is the amount you’ll pay to buy the car.\u003C/p>\r\n\u003Cp>\u003Cstrong>2. Determine the buyout timing\u003C/strong>\u003C/p>\r\n\u003Cul>\r\n\u003Cli>End-of-Lease Buyout: This occurs at the end of your lease term, where you pay the residual value plus any applicable fees.\u003C/li>\r\n\u003Cli>Early Buyout: You can choose to buy the car before the lease term ends. This involves paying the remaining lease payments, the residual value, and possibly an early termination fee.\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cstrong>3. Evaluate the car’s market value\u003C/strong>\u003Cbr />Compare the residual value with the car’s current market value. If the residual value is lower or comparable to the market value, buying out the lease could be a good financial decision.\u003C/p>\r\n\u003Cp>\u003Cstrong>4. Arrange financing\u003C/strong>\u003Cbr />If you don’t have the cash to buy the vehicle outright, you’ll need to arrange financing. You can: Apply for a car loan from a bank or credit union or you can check if the leasing company offers financing options for the buyout.\u003C/p>\r\n\u003Cp>\u003Cstrong>5. Notify the leasing company\u003C/strong>\u003Cbr />Inform the leasing company of your intention to buy out the lease. They will provide you with the necessary paperwork and the final buyout amount, which may include taxes and fees.\u003C/p>\r\n\u003Cp>\u003Cstrong>6. Complete the paperwork\u003C/strong>\u003Cbr />Fill out and submit all required paperwork, which may include: Buyout form provided by the leasing company and loan documents if you are financing the buyout.\u003Cbr />\u003Cbr />\u003Cstrong>7. Make the payment\u003C/strong>\u003Cbr />Pay the buyout amount as specified by the leasing company. This can be done through: A lump-sum payment if you’re paying in cash or financing through a loan if you’ve arranged one.\u003Cbr />\u003Cbr />\u003Cstrong>8. Transfer ownership\u003C/strong>\u003Cbr />Once the payment is processed, the leasing company will transfer the title and ownership of the car to you. Make sure you receive all necessary documents, including: The vehicle title, bill of sale and lien release, if applicable.\u003Cbr />\u003Cbr />\u003Cstrong>9. Register the car\u003C/strong>\u003Cbr />Visit your local provincial or territorial licensing office to register the car in your name. You’ll need to provide:\u003C/p>\r\n\u003Cul>\r\n\u003Cli>Proof of purchase.\u003C/li>\r\n\u003Cli>Proof of insurance.\u003C/li>\r\n\u003Cli>Completed transfer of ownership documents.\u003C/li>\r\n\u003Cli>Pay any applicable registration fees.\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cstrong>Considerations\u003C/strong>\u003C/p>\r\n\u003Cul>\r\n\u003Cli>Car Condition: Ensure the car is in good condition, as any excessive wear and tear could affect the buyout decision.\u003C/li>\r\n\u003Cli>Warranty: Check if the car is still under warranty or consider purchasing an extended warranty.\u003C/li>\r\n\u003Cli>Financial Impact: Ensure the buyout and any associated costs fit within your budget and financial plans.\u003C/li>\r\n\u003Cli>Future Maintenance: Consider potential maintenance and repair costs as the car ages.\u003C/li>\r\n\u003C/ul>\r\n\u003Cp>\u003Cstrong>Benefits of buying out a lease\u003C/strong>\u003C/p>\r\n\u003Cul>\r\n\u003Cli>Ownership: You gain full ownership of the car.\u003C/li>\r\n\u003Cli>Avoid Fees: You avoid lease-end fees, such as excessive wear and tear charges or mileage overage fees.\u003C/li>\r\n\u003Cli>Familiarity: You already know the car’s history and condition.\u003C/li>\r\n\u003C/ul>\r\n\u003Ch2>Lease vs Finance \u003C/h2>\r\n\u003Cp>Below we examine the key differences between leasing and financing the same car as these are the two most popular methods of obtaining a new vehicle in Canada.\u003C/p>\r\n\u003Cp>\u003Cstrong>Ownership\u003C/strong>\u003C/p>\r\n\u003Cp>Lease: When you lease a new car, you’re essentially renting it for a set period (usually 2-3 years). At the end of the lease term, you return the car and can either lease a new vehicle or choose not to lease another car.\u003C/p>\r\n\u003Cp>Finance: When you finance a car, you’re taking out a loan to purchase it. Once you’ve paid off the loan, you own the car outright and can keep it as long as you want.\u003C/p>\r\n\u003Cp>\u003Cstrong>Payments\u003C/strong>\u003C/p>\r\n\u003Cp>Lease: Lease payments are typically lower monthly payments than loan payments because you're only paying for the car's depreciation during the lease term, not the full purchase price.\u003C/p>\r\n\u003Cp>Finance: Monthly loan payments are typically higher than lease payments because you’re paying off the entire purchase price of the car, plus interest.\u003C/p>\r\n\u003Cp>\u003Cstrong>Mileage Limits\u003C/strong>\u003C/p>\r\n\u003Cp>Lease: Leases often come with mileage limits, and exceeding these limits can result in additional fees.\u003C/p>\r\n\u003Cp>Finance: There are no mileage restrictions with financing, so you can drive as much as you want without worrying about penalties.\u003C/p>\r\n\u003Cp>\u003Cstrong>Maintenance\u003C/strong>\u003C/p>\r\n\u003Cp>Lease: Some leases include maintenance packages, which can help with regular upkeep costs.\u003C/p>\r\n\u003Cp>Finance: You’re responsible for all maintenance costs and repair costs once the car is out of warranty.\u003C/p>\r\n\u003Cp>\u003Cstrong>Customization\u003C/strong>\u003C/p>\r\n\u003Cp>Lease: Leasing usually doesn’t allow for modifications or customizations to the vehicle.\u003C/p>\r\n\u003Cp>Finance: You can customize or modify the car as you like.\u003C/p>\r\n\u003Cp>\u003Cstrong>Resale Value\u003C/strong>\u003C/p>\r\n\u003Cp>Lease: At the end of the lease you do not own the vehicle. In most cases you will have the option to buy out the car at the end of the lease. Your lease agreement will include the buyout terms, including the residual value, which is the car's estimated value at the end of the lease term. This is the amount you would pay to buy the car.\u003C/p>\r\n\u003Cp>Finance: When you finance a car, you have the option to sell it or trade it in later. You can also benefit from any resale value it may have.\u003C/p>\r\n\u003Cdiv class=\"block-quote\">\r\n\u003Ch2>Can I afford a car loan?\u003C/h2>\r\n\u003Cp>If you'd prefer to take ownership of your next car, an auto loan might be more affordable than you think. It takes seconds to see what your monthly payment could look like with our \u003Ca href=\"https://www.canadadrives.ca/car-loan-calculator/?utm_source=blog&utm_medium=car-leasing-canada-guide&utm_campaign=inline-link-car-loan-calculator\">car loan affordability calculator\u003C/a>.\u003C/p>\r\n\u003C/div>\r\n\u003Ch2>\u003Cstrong>Car leasing options\u003C/strong>\u003C/h2>\r\n\u003Cp>There are a few car leasing options in Canada, and depending on your personal needs and interests, one may be better suited than the others.\u003C/p>\r\n\u003Cul>\r\n\u003Cli>\u003Cstrong>Standard rental leases\u003C/strong> offer you the opportunity to drive brand new vehicles, so long as your credit profile is approved. You’ll be expected to make a small down payment, followed by monthly payments for the remainder of your car lease term. Once your lease term expires, you must return the car to the dealership, where you may choose to extend the lease or trade in your current car for a newer ride.\u003C/li>\r\n\u003C/ul>\r\n\u003Cul>\r\n\u003Cli>\u003Cstrong>Leasing to own\u003C/strong>, on the other hand, gives you the \u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/car-lease-to-own\">option to purchase a vehicle once its lease term expires\u003C/a>. You’re required to make regular payments, often on a weekly or bi-weekly schedule, but rather than paying for the mere use of the vehicle, your payments will help you accumulate equity. This option is typically offered by smaller dealerships to customers with bad credit, as a credit check is often skipped over in the approval process. All a customer needs in hand is their proof of identity, residency or citizenship, proof of income, and occasionally proof of insurance. However, although the approval process is more lenient, you typically won’t have a roster of shiny, brand new vehicles to choose from, as you would in a standard car lease agreement.\u003C/li>\r\n\u003C/ul>\r\n\u003Cul>\r\n\u003Cli>\u003Cstrong>Lease takeovers\u003C/strong> can be a great opportunity to get a good deal on a lease \u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/car-lease-takeover\">by taking over someone else's lease payments\u003C/a>. The upstart costs and fees are lower, and often there is a cash incentive to taking over someone’s lease. With that said, there are also some risks to taking over a lease, such as inheriting vehicle condition and mileage overages which may come as a surprise at the end of the lease if you don’t inspect the lease terms.\u003C/li>\r\n\u003C/ul>\r\n\u003Cul>\r\n\u003Cli>\u003Cstrong>Leasing a used car or certified pre owned\u003C/strong> \u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/can-you-lease-a-used-car\" target=\"_blank\" rel=\"noopener\">is possible\u003C/a> and is often the case if you’re in a lease-to-own agreement. In other instances, a customer may wish to terminate their lease contract early and seek someone who would be willing to take over their payments. If that someone is you, then you could save money on down payment costs, but before you jump in the driver’s seat, be sure to thoroughly inspect the vehicle for any damage, wear, or kilometre overage, as you assume responsibility once you take over lease payments. And, while it may seem cheaper to go with a used car rather than a new one, you may end up incurring heavier costs for maintenance, as the warranty expires, and the car’s reliability decreases with age.\u003C/li>\r\n\u003C/ul>\r\n\u003Ch2>\u003Cstrong>Can you get a one-year car lease?\u003C/strong>\u003C/h2>\r\n\u003Cp>A short-term car lease is typically a minimum of two years. One-year leases are available but they’re rare. If you do find a dealership offering a one-year lease agreement, you’ll find that your monthly payment will be very high due to depreciation. However, you might be able to lease a used car and bypass high depreciation costs. Alternatives to one-year vehicle leases include long-term rentals and a lease takeover.\u003C/p>\r\n\u003Cp>Leasing a car lets you drive a brand new vehicle without the more expensive cost of purchasing one. Of course, car leases are appealing to many; who wouldn’t want to drive a high-end car without the big price?! If you’re one of the many interested individuals, you’ve already weighed the pros and cons and now you're wondering “how do you lease a car”?\u003C/p>\r\n\u003Ch2>How to lease a car in Canada in 9 steps\u003C/h2>\r\n\u003Cp>Leasing a car lets you drive a brand new vehicle without the more expensive cost of purchasing one. If you’re one of those interested individuals who has already weighed up the pros and cons and is now wondering “how do you lease a car”?\u003C/p>\r\n\u003Cp>If you're intent on leasing a car, these 9 steps will guide you through the process. In an ideal situation where you know exactly what you want, leasing a car can be done pretty quickly. For others, it may take up to a couple of weeks.\u003C/p>\r\n\u003Ch3>Check Your Credit Score\u003C/h3>\r\n\u003Cdiv id=\"credit-score\" class=\"step\">\u003Cimg src=\"https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/6/667c9e25537ae.png\" alt=\"Credit Score Meter Icon\" width=\"200\" height=\"200\" align=\"middle\" />\r\n\u003Cp>Remember, you normally need an above-average credit score to get approved for a lease. According to Equifax, any score over 660 is considered good. If you’re not there yet and have poor credit or no credit at all, don’t worry! You can check your \u003Ca href=\"https://www.canadadrives.ca/blog/credit/free-credit-score-vs-credit-report\">credit score\u003C/a> for free, and there are things you can do to \u003Ca href=\"https://www.springfinancial.ca/blog/credit-tips/how-to-improve-your-credit-score\">improve your credit\u003C/a> too!\u003C/p>\r\n\u003C/div>\r\n\u003Cp> \u003C/p>\r\n\u003Ch3>Create a Budget\u003C/h3>\r\n\u003Cdiv id=\"budget\" class=\"step\">\u003Cimg src=\"https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/6/667c9e3751ab0.png\" alt=\"Lease Budget Icon\" width=\"200\" height=\"200\" />\r\n\u003Cp>When leasing a vehicle, your monthly payment might be lower than if you finance, but you also need to consider a potential down payment, \u003Ca href=\"https://www.canadadrives.ca/blog/buying-a-vehicle/first-time-car-buyer-tips\">insurance, fuel, maintenance\u003C/a>, and more. It’s wise to sit down and crunch some numbers to make sure you know exactly what you can afford without feeling financially squeezed.\u003C/p>\r\n\u003C/div>\r\n\u003Cp> \u003C/p>\r\n\u003Ch3>Find the Right Car\u003C/h3>\r\n\u003Cdiv id=\"find\" class=\"step\">\u003Cimg src=\"https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/6/667c9e547522d.png\" alt=\"Mobile Car Search Icon\" width=\"200\" height=\"200\" />\r\n\u003Cp>Firstly, you need to decide what type of vehicle suits your needs! Maybe you need a big family car, or maybe you need a luxury model for business purposes? Obviously, the internet is a powerful research tool. Google Search and YouTube alone can help you narrow down your choices until you find “The One.”\u003C/p>\r\n\u003C/div>\r\n\u003Cp> \u003C/p>\r\n\u003Ch3>Find the Right Dealership\u003C/h3>\r\n\u003Cdiv id=\"dealer\" class=\"step\">\u003Cimg src=\"https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/6/667c9e6a87719.png\" alt=\"Car Dealership Icon\" width=\"200\" height=\"200\" />\r\n\u003Cp>Once you’ve chosen a car, it’s best to research different vendors and available offers. Understand all your options so you can \u003Ca href=\"https://www.canadadrives.ca/blog/car-guide/how-to-negotiate-with-a-car-dealer\">negotiate\u003C/a> and walk away from a deal if you don’t like what’s being offered.\u003C/p>\r\n\u003C/div>\r\n\u003Cp> \u003C/p>\r\n\u003Ch3>Book a Test Drive\u003C/h3>\r\n\u003Cdiv id=\"test-drive\" class=\"step\">\u003Cimg src=\"https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/6/667c9e7ae8640.png\" alt=\"Test Drive Icon\" width=\"200\" height=\"200\" />\r\n\u003Cp>Take the vehicle you are interested in out for a test drive so you can be sure it meets your requirements and is everything you expected it to be.\u003C/p>\r\n\u003C/div>\r\n\u003Cp> \u003C/p>\r\n\u003Ch3>Consider a Down Payment\u003C/h3>\r\n\u003Cdiv id=\"downpayment\" class=\"step\">\u003Cimg src=\"https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/6/667c9e8ba2d1b.png\" alt=\"Downpayment Icon\" width=\"200\" height=\"200\" />\r\n\u003Cp>Down payments are not entirely necessary for car leases but are helpful in some instances. For one, money down increases the likelihood of getting approved and reduces your monthly payments. If you don't have the savings to make a down payment, don't worry, a \u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/0-down-car-lease\">0 down car lease\u003C/a> is possible. \u003C/p>\r\n\u003C/div>\r\n\u003Cp> \u003C/p>\r\n\u003Ch3>Review Your Lease Agreement\u003C/h3>\r\n\u003Cdiv id=\"review\" class=\"step\">\u003Cimg src=\"https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/6/667c9de8ef877.png\" alt=\"Lease Agreement Icon\" width=\"200\" height=\"200\" />\r\n\u003Cp>Once you select a car and get approved for finance, you’ll want to examine your lease agreement closely. Take note of your monthly payment, down payment, length of the term, what maintenance you’re responsible for, and other fees. If you need to change anything at the last minute, you can discuss it with your dealer.\u003C/p>\r\n\u003C/div>\r\n\u003Cp> \u003C/p>\r\n\u003Ch3>Start Making Payments\u003C/h3>\r\n\u003Cdiv id=\"payments\" class=\"step\">\u003Cimg src=\"https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/6/667c9ea7d7409.png\" alt=\"Car Payments Icon\" width=\"200\" height=\"200\" />\r\n\u003Cp>Now that you have a leased car, drive off the lot and start making payments! If you don’t miss any payments, a lease can help boost your credit score!\u003C/p>\r\n\u003C/div>\r\n\u003Cp> \u003C/p>\r\n\u003Ch3>Remember Routine Maintenance\u003C/h3>\r\n\u003Cdiv id=\"maintenance\" class=\"step\">\u003Cimg src=\"https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/6/667c9ebd65a41.png\" alt=\"Car Maintenance Icon\" width=\"200\" height=\"200\" />\r\n\u003Cp>Many people don’t need to be told to take care of their car, but it’s worth reiterating for a leased car. Any damage incurred or neglect could end up costing you at the end of the lease term.\u003C/p>\r\n\u003C/div>\r\n\u003Cp> \u003C/p>\r\n\u003Cdiv class=\"block-quote\">\r\n\u003Ch2>Get pre-approved today\u003C/h2>\r\n\u003Cp>If you're leaning towards financing a car instead of leasing, it takes two minutes to know if you're eligible for a car loan by getting pre-approved online. With a pre-approval you can shop with confidence knowing exactly what you can afford.\u003C/p>\r\n\u003Cp>\u003Ca href=\"https://apply.canadadrives.ca/\">Get pre-approved today.\u003C/a>\u003C/p>\r\n\u003C/div>","2024-07-24","/uploads/2022/5/6282de82bfb6c.jpg","/uploads/2022/5/6282de83608fe.jpg","/uploads/2022/5/6282de8389f02.jpg","/uploads/2022/5/6282de83cdae4.jpg","Car Leasing Canada","How To Lease a Car: Car Leasing in Canada Explained | Canada Drives","Everything you wanted to know about leasing a car in Canada—simplified! Find out if it’s the best option for you & how to get the best deal…","2018-11-22 00:18:15","2024-07-24 15:24:05","Jul 24, 2024","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2022/5/6282de83cdae4.jpg","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2022/5/6282de8389f02.jpg","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2022/5/6282de82bfb6c.jpg",{"id":192,"testimonial_id":13,"score":13,"url":193,"title":194,"quote":195,"body":196,"amp_body":13,"amp_verified":13,"publish_at":197,"img_thumb":198,"img_small":199,"img_medium":200,"img_large":201,"alt_text":202,"image_source":82,"seo_title":203,"seo_description":204,"seo_keywords":84,"type_id":6,"category_id":17,"user_id":205,"author":6,"deleted_at":13,"created_at":206,"updated_at":207,"category_url":20,"category_name":18,"publish_date":208,"img_large_src":209,"img_medium_src":210,"img_thumb_src":211},562,"0-car-finance","0% Financing Car Deals in Canada: Fact or Fiction?","There’s something about seeing those 0% financing offers in car commercials and internet ads that makes you think \"free money!\" Doesn’t 0% financing essentially mean you not only get a loan, but you don’t have to pay interest on that loan?","\u003Cp>Technically yes, but like most too-good-to-be-true deals in life, it’s not that simple. \u003C/p>\r\n\u003Cp>The offer of 0% financing is one of the most common in the auto industry for a reason. It entices the buyer like few other promotions can. The idea of getting great financing deals while making expensive vehicles seem more accessible seems very appealing. But what many don’t know is that while saving money on a vehicle with 0% financing is possible, \u003Cstrong>it’s not easy to get approved\u003C/strong> for a vehicle at this rate. To qualify for a zero percent car loan you often need an excellent credit score, so if your credit history isn't looking too good your chances of qualifying for 0% is probably pretty slim. For those select few who do get approved, 0% financing still may not be worth it in the long run.\u003C/p>\r\n\u003Cp>So before you sign on the dotted line, let’s pull back the curtain on 0% financing and see what’s really going on behind the scenes. And then let's talk about how you can \u003Cstrong>find the best car deals near you and the best place to finance a car\u003C/strong>, with or without 0% APR. (APR stands for Annual Percentage Rate. It is the yearly interest rate charged on borrowed money, expressed as a percentage of the loan amount).\u003C/p>\r\n\u003Ch2>What does 0% car financing mean?\u003C/h2>\r\n\u003Cp>When you apply for auto financing, you agree to borrow money from a financial institution—either a bank, in-house financing at the dealership, or other lending institution—to help pay for the car loan. For this service, you will be charged an interest rate, which is a fee that you pay every month for the duration of the loan term, in addition to the principal sum of money borrowed.\u003C/p>\r\n\u003Cp>\u003Cstrong>Zero percent financing means that\u003C/strong> \u003Cstrong>you can get approved for finance without having to pay any interest\u003C/strong>.\u003C/p>\r\n\u003Cp>But why would any lender do that?\u003C/p>\r\n\u003Cp>Well, it’s usually not the banks that offer this type of financing, but rather the automaker or new car dealership itself.\u003C/p>\r\n\u003Cp>This financing incentive is beneficial to dealers and manufacturers because it helps them clear out old inventory and select models in order to make space for newer models. It can also spark sales of slow-selling vehicles. \u003C/p>\r\n\u003Cp>If the dealer can motivate a vehicle purchase by forgoing the interest on your loan, they might calculate it makes good business sense in order to move inventory.\u003C/p>\r\n\u003Cp>Furthermore, this typically happens when you have already qualified for a loan with a low APR, so the dealer has calculated that the amount they are covering is acceptable.\u003C/p>\r\n\u003Ch2>How can I get 0% financing on a car?\u003C/h2>\r\n\u003Cp>While the offer of 0% financing might be easy to find, your chances of actually getting that interest rate could be more elusive. Zero percent is commonly reserved for customers shopping for new cars with outstanding credit scores and great credit history.\u003C/p>\r\n\u003Cp>New car dealerships that promote these 0% APR special offers don't usually specify that only buyers with great credit will get approved. That’s in the fine print. The reality is that automakers maintain strict applicant criteria that must be met before 0% financing is offered. \u003C/p>\r\n\u003Cp>Having said that, \u003Cstrong>qualifying for 0% car finance with imperfect credit is possible\u003C/strong>. Despite a lower credit score, applicants may get approved for special vehicle offers if they can prove that they can make their monthly payments in full for the duration of the term. Sometimes a co-signer, larger down payment, or collateral will be requested. It also helps if the customer has shown loyalty to the car brand.\u003C/p>\r\n\u003Cp>If you walk into a dealership that has a special promotion and you find out you’re not eligible, don’t fret because 0% financing isn't the only offer worth pursuing. At any given time, there's plenty of value to be found in the new and pre-owned car market. \u003C/p>\r\n\u003Ch2>Is 0% car financing worth it?\u003C/h2>\r\n\u003Cp>As enticing as 0% financing sounds, it might not always be the best deal on offer. For example, a 0% interest loan is usually offered versus a cash rebate option, and the rebate option can often work out better for you, so make sure you have a calculator close by when you're considering your options. See the example below.\u003C/p>\r\n\u003Cdiv class=\"block-quote\">\r\n\u003Ch3>0% Finance vs. Cash Rebate\u003C/h3>\r\n\u003Cp>Steve wants to buy a car priced at $30,000. He applied and got approved with two different dealerships/lenders. With \u003Cstrong>Option A\u003C/strong>, he got a financing rate of 5% and a cash bonus rebate of $5,000. With \u003Cstrong>Option B\u003C/strong>, he was offered the 0% financing rate instead of the cash rebate.\u003C/p>\r\n\u003Cp>In \u003Cstrong>Option A\u003C/strong>, Steve will take the $5,000 cash rebate and pay $3,300 in interest on the $25,000 sum borrowed over the course of a 60-month term. He pays $28,300 altogether.\u003C/p>\r\n\u003Cp>In \u003Cstrong>Option B\u003C/strong>, he will take 0% APR, but he will have higher monthly payments without the cash rebate. Over 60 months, he will pay $30,000 altogether. Just the principal. There is no rebate or interest to calculate.\u003C/p>\r\n\u003Cp>In this circumstance, the \u003Cstrong>cash rebate works out better than 0% financing\u003C/strong>. If there's a trade-in or down payment, you should factor these into your calculations as well.\u003C/p>\r\n\u003Cp>Furthermore, this example does not factor in car sales tax, but it's worth remembering that the rebate not only decreases the amount of interest you ultimately pay, but also how much tax you will pay on the total amount financed. If you have a trade in vehicle that can also decrease the amount of tax you need to pay as it lowers the total amount owed. \u003C/p>\r\n\u003C/div>\r\n\u003Ch2>Other reasons why 0% finance might not be the best offer\u003C/h2>\r\n\u003Cp>While the 0% APR promotion is usually the most attractive at first glance, there are multiple reasons why you shouldn't jump at the first offer that comes along. Below are a few reasons why you might steer clear of a 0% financing offer:\u003C/p>\r\n\u003Ch3>Your options are limited\u003C/h3>\r\n\u003Cp>As we mentioned earlier, 0% financing is usually offered by dealers and manufacturers to clear out old stock or move under-selling vehicles. Sure, you’re getting a good deal, but you might not be getting the car that you actually want. Popular models or specific trims and features may not be included in a zero percent interest rate promotion while certain car brands such as luxury brands may never offer a 0% financing promotion. \u003C/p>\r\n\u003Ch3>You don't decide the term\u003C/h3>\r\n\u003Cp>It’s important to note that 0% financing offers typically don't let you choose the length of the term. You might only get 0% interest for a certain period before a higher interest rate kicks in. This abrupt change in monthly payments could be disruptive to your finances and it might encourage you to accept a shorter term. That’s not ideal if you were hoping for a longer term to keep monthly payments low. With 0% APR, you may have to provide a larger down payment to keep payments low and get the loan paid off before the higher rate kicks in.\u003C/p>\r\n\u003Ch3>No 0% financing on used cars\u003C/h3>\r\n\u003Cp>The 0% interest rate offer is utilized by many dealerships and manufacturers to move new vehicle inventory to make space for incoming models. For example, don’t be surprised to see 0% financing available on this year's models just when the latest models for next year are making their way to dealer lots and online shopping. In other words, pre-owned vehicles are not part of the equation. While there are many great deals to be found in the used car market, don’t expect to find this promotional offer available for used vehicles.\u003C/p>\r\n\u003Ch2>Other financing options for new and used cars\u003C/h2>\r\n\u003Cp>0% financing isn't the only option out there when it comes to financing a new car. There are several other popular financing options to consider:\u003Cbr />\u003Cbr />\u003Cstrong>1. Traditional Auto Loans\u003Cbr />\u003C/strong>\u003Cbr />Description: A standard loan provided by banks, credit unions, or online lenders where you pay back the principal amount plus interest over a set term (usually 36, 48, or 60 months).\u003Cbr />\u003Cbr />Pros: Flexible terms, competitive interest rates, and potential for negotiation.\u003Cbr />\u003Cbr />Cons: Interest rates vary based on credit score, and longer terms can lead to higher overall interest costs.\u003Cbr />\u003Cbr />Read how to \u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/how-to-qualify-for-car-financing-with-bad-credit-in-canada\">get approved\u003C/a> for a car loan with bad credit in Canada \u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/how-to-qualify-for-car-financing-with-bad-credit-in-canada\">here\u003C/a>.\u003C/p>\r\n\u003Cp>\u003Cstrong>2. Dealer Financing\u003Cbr />\u003C/strong>\u003Cbr />Description: Financing arranged directly through the car dealership, often with promotional rates or special offers other than 0% financing, such as cash rebates.\u003Cbr />\u003Cbr />Pros: Convenience, potential for special offers or incentives.\u003Cbr />\u003Cbr />Cons: Interest rates might be higher than those available through banks or credit unions, and the dealership might not always offer the best terms.\u003Cbr />\u003Cbr />\u003Cstrong>3. Lease Financing\u003Cbr />\u003C/strong>\u003Cbr />Description: Renting the car for a specified term (typically 24-36 months) with the option to buy at the end of the lease or return the car.\u003Cbr />\u003Cbr />Pros: Lower monthly payments, the ability to drive a new car every few years, potential tax benefits.\u003Cbr />\u003Cbr />Cons: Mileage limits, wear-and-tear charges, no ownership of the vehicle unless you choose to buy it at the end of the lease.\u003Cbr />\u003Cbr />Read more: \u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/car-leasing-canada-guide\">How to Lease a Car: Car Leasing in Canada Explained\u003C/a>\u003Cbr />\u003Cbr />\u003Cstrong>4. Personal Loans\u003Cbr />\u003C/strong>\u003Cbr />Description: Unsecured loans from banks, credit unions, or online lenders that can be used for any purpose, including buying a car.\u003Cbr />\u003Cbr />Pros: Flexibility in how the funds are used, no collateral required.\u003Cbr />\u003Cbr />Cons: Higher interest rates compared to secured auto loans, potential for higher monthly payments.\u003Cbr />\u003Cbr />Read more: \u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/auto-loans-vs-personal-loans\">Auto Loans vs. Personal Loans\u003C/a>\u003C/p>\r\n\u003Cp> \u003C/p>\r\n\u003Ch2>The best place to finance a car & get a great deal (without 0% car finance)\u003C/h2>\r\n\u003Cp>If 0% financing doesn’t work out for you, don’t lose heart. There are plenty of other ways to find the right car at the right price. Follow these tips to ensure you\u003Cstrong> find the best possible deal\u003C/strong> with or without 0% financing.\u003C/p>\r\n\u003Cp>\u003Cstrong>1. Get pre-approved in minutes: \u003C/strong>Before you start looking at new cars, it's a good idea to find out firsthand what rate and deals you’re eligible for. Canada Drives can help you figure out what kind of financing you qualify for, even if you have bad credit. With a pre-approval in your back pocket, you’ll know exactly what vehicle options you're eligible for, saving you a lot of time and frustration.\u003C/p>\r\n\u003Cp>\u003Ca href=\"https://apply.canadadrives.ca/\">Get pre-approved now\u003Cbr />\u003C/a>\u003Cbr />\u003Cstrong>2. Shop pre-owned: \u003C/strong>There are fantastic deals to be found in the used car market regardless of 0% financing. The benefit of buying a used car from a dealership is that you know the car has been professionally inspected and serviced. Furthermore, car dealers and online vendors rely on repeat business, referrals, and online reviews. Therefore, you can be confident that you’re getting a reliable vehicle. Typically, you won’t enjoy the same value for money with a brand new car, or the same peace of mind when you buy a used car in a private sale.\u003C/p>\r\n\u003Cp>\u003Cstrong>3. Mark your calendar:\u003C/strong> Even if 0% financing offers are coming up short, look for special sale events like \u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/employee-pricing-fact-or-fiction\">Employee Pricing\u003C/a>, cash rebates, and other promotions. These events generally kick off in the late summer months alongside other promotional offers to clear lots and make space for next year’s models. But there are other opportune times to snag a deal, such as: \u003C/p>\r\n\u003Col>\r\n\u003Col>\r\n\u003Cul>\r\n\u003Cli>towards the end of the year. \u003C/li>\r\n\u003Cli>towards the end of every month. \u003C/li>\r\n\u003Cli>during slower days at the dealership (i.e. weekdays).\u003C/li>\r\n\u003Cli>During the off-season for your vehicle type (i.e. shop for convertibles in October).\u003C/li>\r\n\u003C/ul>\r\n\u003C/ol>\r\n\u003C/ol>\r\n\u003Cp>Read more about \u003Ca href=\"https://www.canadadrives.ca/blog/car-guide/when-is-the-best-time-to-get-a-new-car\" target=\"_blank\" rel=\"noopener\">the best times to buy a car.\u003Cbr />\u003Cbr />\u003C/a>\u003Cstrong>4. Work on your credit score: \u003C/strong>Traditionally, 0% financing is reserved for customers with the best credit scores. But that’s not always realistic for many potential car buyers. Fortunately for today's car buyer, you can get approved for great deals regardless of credit. But in the long run, it makes good financial sense to work towards improving your credit score. Fortunately, \u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/do-car-loans-help-build-credit\">any car loan you get approved for today can help you start building credit\u003C/a> for tomorrow.\u003C/p>\r\n\u003Cdiv class=\"block-quote\">\r\n\u003Ch2>Get pre-approved with Canada Drives\u003C/h2>\r\n\u003Cp>Zero percent financing isn't the only great car deal out there. The used car market is more robust then ever and a great place to find the best car deals; you just need to know where to look. \u003Ca href=\"https://apply.canadadrives.ca/\">Get pre-approved for a car loan\u003C/a> today and Canada Drives will connect you with a dealership in your area who can get you a great deal on a vehicle you love!\u003C/p>\r\n\u003C/div>","2024-07-23","/uploads/2021/6/60c6beee70cb4.jpg","/uploads/2021/6/60c6beef631e6.jpg","/uploads/2021/6/60c6beefc7861.jpg","/uploads/2021/6/60c6bef048f01.jpg","0% Car Financing Deals in Canada: Fact or Fiction?","0% Financing Car Deals in Canada: Fact or Fiction? | Canada Drives","Is zero percent interest financing possible for most Canadians or just another sales tactic? Find out what great deals you qualify for, including 0% APR...",4,"2019-01-09 18:30:00","2024-07-23 15:42:13","Jul 23, 2024","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2021/6/60c6bef048f01.jpg","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2021/6/60c6beefc7861.jpg","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2021/6/60c6beee70cb4.jpg",{"id":213,"testimonial_id":13,"score":13,"url":214,"title":215,"quote":216,"body":217,"amp_body":13,"amp_verified":13,"publish_at":218,"img_thumb":219,"img_small":220,"img_medium":221,"img_large":222,"alt_text":223,"image_source":82,"seo_title":224,"seo_description":225,"seo_keywords":84,"type_id":6,"category_id":17,"user_id":104,"author":6,"deleted_at":13,"created_at":226,"updated_at":227,"category_url":20,"category_name":18,"publish_date":228,"img_large_src":229,"img_medium_src":230,"img_thumb_src":231},33,"do-car-loans-help-build-credit","Does Financing a Car Build Credit?","Did you know that a car loan can help you build credit? Making routine payments on time shows lenders that you're trustworthy. Your payment history accounts for 35% of your overall credit score.","\u003Ch2>Does a car loan build credit?\u003C/h2>\r\n\u003Cp>If you can \u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/how-to-qualify-for-car-financing-with-bad-credit-in-canada\">get approved\u003C/a>, a car loan is an effective strategy for credit building. Especially if you have bad credit. \u003C/p>\r\n\u003Cp>\u003Cstrong>Making payments on your car loan helps improve your payment history, resulting in a boost to your credit score\u003C/strong>\u003C/p>\r\n\u003Cp>Your credit score is based on components like \u003Cstrong>payment history\u003C/strong>, how much debt is owed, the total length of credit history, what kind of credit you have (revolving or instalment), if you have any new credit on file, and your overall payment history. It is a number between 300 and 900 that represents your overall creditworthiness as a borrower.\u003C/p>\r\n\u003Cp>Although all of these components impact your \u003Ca href=\"https://www.canadadrives.ca/credit-score\">credit score\u003C/a>, they’re each calculated differently. \u003C/p>\r\n\u003Cdiv class=\"block-quote\">\u003Cstrong>In this article, you'll learn:\u003C/strong>\r\n\u003Col>\r\n\u003Cli>\u003Ca href=\"#how\">How car loans build credit\u003C/a>\u003C/li>\r\n\u003Cli>\u003Ca href=\"#advantages\">The advantages of building credit with a car loan\u003C/a>\u003C/li>\r\n\u003Cli>\u003Ca href=\"#how-to-rebuild-credit-with-car-loan\">How to rebuild your credit with an auto loan\u003C/a>\u003C/li>\r\n\u003C/ol>\r\n\u003C/div>\r\n\u003Ch2 id=\"how\">How do car loans build credit?\u003C/h2>\r\n\u003Cp>Your payment history accounts for 35% of your overall credit score, while 30% of your credit score is based on how much of your revolving credit you’re using. If you’re successful at paying back your loans, and keep a low balance on your credit card, these large percentages will have a positive impact on your score. However, if you struggle paying back your accumulated debt and can’t seem to get your payment history under control, your credit score is due to suffer. A low credit score will negatively impact your chances of getting approved for a loan in the future.\u003C/p>\r\n\u003Cp>If you get a \u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/cash-back-car-loan\">car loan with cashback\u003C/a>, you can get another \u003Ca href=\"https://www.canadadrives.ca/blog/credit/how-to-fix-bad-credit-and-improve-your-credit-score-fast\">credit score boost from your car loan\u003C/a> by using that money to pay down your credit card balance.\u003C/p>\r\n\u003Cp>\u003Cimg src=\"https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/6/667f23b9d9d6e.jpg\" alt=\"Breakdown of Credit Score Factors\" width=\"670\" height=\"789\" />\u003C/p>\r\n\u003Cp class=\"block-quote\">If you're looking for a \u003Ca href=\"https://apply.canadadrives.ca/\">car loan to rebuild credit\u003C/a>, Canada Drives is the solution for you. We offer affordable financing rates to Canadians facing all types of credit situations. Get pre-approved and browse hundreds of certified vehicles today.\u003C/p>\r\n\u003Cp>There are several routes to take when it comes to fixing credit. Debt consolidation, \u003Ca href=\"https://www.springfinancial.ca/blog/pay-off-debt/credit-and-debt-counselling\">negotiating with your creditors\u003C/a>, or planning to \u003Ca href=\"https://www.springfinancial.ca/blog/pay-off-debt/how-to-get-out-of-debt-fast\">pay off high-interest debts first\u003C/a> (the Debt Snowball Method), are all strategies that can help you lessen the debt load and increase your credit score. \u003C/p>\r\n\u003Ch2 id=\"advantages\">\u003Cstrong>Advantages of building credit with a car loan \u003C/strong>\u003C/h2>\r\n\u003Cp>Let's take a look at the advantages of using a car loan to build credit, how to use the loan opportunity effectively, and how Canada Drives makes it easy to get approved for your credit-building car loan.\u003C/p>\r\n\u003Cp>These three reasons demonstrate how an auto loan might be your best option for rebuilding credit.\u003C/p>\r\n\u003Ch3>\u003Cstrong>1. Auto loans are secured\u003C/strong>\u003C/h3>\r\n\u003Cp>Secured credit is a type of loan that is backed by collateral. In the case of an auto loan, the vehicle is the collateral which means that it can be repossessed if a borrower fails to make monthly payments in full each month. Due to this, secured loans will typically have a lower interest rate compared to unsecured loans – loans that can be approved based on the borrower’s creditworthiness without collateral. \u003C/p>\r\n\u003Cp>A lender may be skeptical approving a borrower with less than perfect credit for an unsecured loan and in return, increase the interest rates. With a secured auto loan, you’ll likely get low-interest rates with affordable payments thanks to the collateral.\u003C/p>\r\n\u003Ch3>\u003Cstrong>2. You need credit to build credit\u003C/strong>\u003C/h3>\r\n\u003Cp>In order to get your credit rating back on track, you need to prove to lenders that you can responsibly manage a healthy mix of credit. Paying your monthly bills on time and in full will improve your credit score but opening up a new form of credit can add to your mix of credit and help you rebuild your score as you work to pay off your debt.\u003C/p>\r\n\u003Cp>To build credit the borrower cannot miss any payments or make late payments. The borrower should also keep the auto loan open for at least a year, even if he or she has enough to pay off the loan sooner. Keeping the loan open shows a pattern of responsible payment history which is what builds a credit score.\u003C/p>\r\n\u003Ch3>\u003Cstrong>3. Car loans are easier to get approved for\u003C/strong>\u003C/h3>\r\n\u003Cp>Subprime loans are available to borrowers who apply for an auto loan with a credit score that falls below average. Generally, Canadians with an overall credit score under 670 are considered subprime. \u003C/p>\r\n\u003Cp>While many dealerships can’t help subprime car buyers, there is a growing number of dealerships that specialize in subprime loans, and companies like Canada Drives who can get you \u003Ca href=\"https://apply.canadadrives.ca/\">pre-approved for a car loan online\u003C/a> in minutes.\u003C/p>\r\n\u003Ch2 id=\"how-to-rebuild-credit-with-car-loan\">\u003Cstrong>How to rebuild your credit with an auto loan\u003C/strong>\u003C/h2>\r\n\u003Cp>Are you ready to start improving your credit with an auto loan? These steps will help you prepare, apply, and get approved for an auto loan.\u003C/p>\r\n\u003Ch3>\u003Cstrong>1. Get your commitments current\u003C/strong>\u003C/h3>\r\n\u003Cp>If the current credit you have is past due, overextended, or has been sent to collections, you need to get it under control before applying for a new car loan. You don’t have to pay it all off, but you should catch up with minimum payments for ALL your current credit obligations.\u003C/p>\r\n\u003Ch3>\u003Cstrong>2. Save up a down payment\u003C/strong>\u003C/h3>\r\n\u003Cp>The lower the initial loan amount compared with the vehicle’s value, the less risk the lender has to assume. While zero down car loans are available (even to subprime car buyers), your chances of approval increase when you offer at least 10% of the purchase price as a down payment. \u003C/p>\r\n\u003Ch3>\u003Cstrong>3. Spend within your means\u003C/strong>\u003C/h3>\r\n\u003Cp>If your debt-to-service ratio is already high or if you earn a modest income, think Corolla, not Cadillac. Keep your payments reasonably low so you aren’t stretching your ability to repay. \u003C/p>\r\n\u003Ch3>\u003Cstrong>4. Don’t shotgun your application\u003C/strong>\u003C/h3>\r\n\u003Cp>A tendency is to send in a credit application to several lenders or dealers, expecting a few rejections but potentially one approval. This type of process hurts your chances all around. A service like Canada Drives can match up \u003Ca href=\"https://apply.canadadrives.ca/\">your application\u003C/a> to the right lender to help you get approved for the best possible rate. \u003C/p>\r\n\u003Ch3>\u003Cstrong>5. Pay on time, every time\u003C/strong>\u003C/h3>\r\n\u003Cp>Late and missed payments stay on your credit report for seven years, and it shows lenders that you can’t be trusted to make your payments on time. Make sure that you pay your car loan on time and in full every time it’s due, without question. Avoid grace periods as well.\u003C/p>\r\n\u003Ch2>Get approved with Canada Drives\u003C/h2>\r\n\u003Cp>The right car loan will put you on the right track to a better credit score and improved financial standing. Canada Drives can help you get the vehicle you want with financing that fits your budget. \u003Ca href=\"https://apply.canadadrives.ca/\">Get pre-approved\u003C/a> today (for free) to see what you could be eligible for.\u003C/p>","2024-07-10","/uploads/2024/7/668f03ed41d81.jpg","/uploads/2024/7/668f03ed77567.jpg","/uploads/2024/7/668f03ed89786.jpg","/uploads/2024/7/668f03ed9a915.jpg","Car Loan Application & Credit Report","Does Financing a Car Build Credit? | Canada Drives","Financing a car can help build credit because they can be easier to get approved for, and routinely making payments on time shows creditors you're trustworthy.","2015-11-25 07:38:42","2024-07-10 14:58:05","Jul 10, 2024","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/7/668f03ed9a915.jpg","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/7/668f03ed89786.jpg","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2024/7/668f03ed41d81.jpg",{"id":233,"testimonial_id":13,"score":13,"url":234,"title":235,"quote":236,"body":237,"amp_body":13,"amp_verified":13,"publish_at":238,"img_thumb":239,"img_small":240,"img_medium":241,"img_large":242,"alt_text":243,"image_source":82,"seo_title":244,"seo_description":245,"seo_keywords":84,"type_id":6,"category_id":17,"user_id":246,"author":246,"deleted_at":13,"created_at":247,"updated_at":248,"category_url":20,"category_name":18,"publish_date":249,"img_large_src":250,"img_medium_src":251,"img_thumb_src":252},1461,"what-is-a-car-loan-pre-approval","What Is a Car Loan Pre-approval? (And What’s The Best Way To Get One?)","As exciting as shopping for a new or new-to-you vehicle can be, there’s no question that the traditional car-buying journey can be more than a little stressful. ","\u003Cp>You might do a lot of research comparing cars and trucks you like, trying to find the one that will best suit your needs. You might visit several dealerships and take several test drives. You’ll likely even do some quick math to determine whether you can afford a certain vehicle based on your income. \u003C/p>\r\n\u003Cp>After doing all of that work and zeroing in on your perfect next car, SUV, or truck, it can be crushing when the salesperson comes back and says “Sorry, you haven’t been approved.” \u003C/p>\r\n\u003Cp>Yikes! Not only is that situation highly embarrassing, you’ve also gotten your hopes up for nothing and wasted a lot of your own precious time. \u003C/p>\r\n\u003Cp>Luckily, this awkward scenario can be easily avoided by getting pre-approved for a car loan \u003Cem>before you start looking\u003C/em> at specific vehicles. Everyone, no matter what their financial situation is—whether they have \u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/how-to-qualify-for-car-financing-with-bad-credit-in-canada\">bad credit\u003C/a> or excellent credit—should get a car loan pre-approval before they do anything else. \u003C/p>\r\n\u003Cp>But how exactly does it work in Canada anyway?\u003C/p>\r\n\u003Ch2>\u003Cstrong>How a car loan pre-approval works \u003C/strong>\u003C/h2>\r\n\u003Cp>An auto loan pre-approval works a lot like other loan pre-approvals, such as a \u003Ca href=\"https://www.springfinancial.ca/blog/homeowner-finances/what-every-first-time-home-buyer-must-know\">mortgage\u003C/a>. The lender takes a look at your income, debts, and credit score to determine whether they’re willing to offer you a car loan. If they are, the pre-approval will tell you the \u003Cstrong>maximum loan amount \u003C/strong>they’re willing to offer you, and maybe the interest rate too. These are the terms you’re likely to get should you move forward with a finance application on a specific vehicle. \u003C/p>\r\n\u003Cp>You might also get a breakdown of how much the monthly or bi-weekly payments would be. If you don’t receive this information, visit a \u003Ca href=\"https://www.canadadrives.ca/car-loan-calculator\">car loan calculator\u003C/a> to work out a rough estimate in seconds.\u003C/p>\r\n\u003Cp>Most lenders will not ask for a driver’s licence, proof of income, or consent to a hard credit check until you decide to move ahead with a finance application for a specific vehicle. Sometimes lenders will also ask for additional documentation to verify your identification, such as a utility bill with your name and address on it. \u003C/p>\r\n\u003Ch3>The benefit of a car loan pre-approval\u003C/h3>\r\n\u003Cp>Once you have a pre-approval in hand you can shop for a vehicle more confidently. \u003Cstrong>You’ll know exactly what you can afford\u003C/strong> so you’ll only consider vehicles in your price range. It also means you won’t have to stress about securing financing after a long car hunt. There are other great \u003Ca href=\"https://www.canadadrives.ca/blog/car-finance/online-preapprovals-transformed-the-way-canadians-shop-for-cars\">benefits of getting pre-approved\u003C/a> for a car loan. \u003C/p>\r\n\u003Ch2>\u003Cstrong>Where can you get pre-approved for a car loan? \u003C/strong>\u003C/h2>\r\n\u003Cp>You can get pre-approved for a car loan a few different ways. Historically, most car buyers have done their pre-approvals through the \u003Cstrong>dealership\u003C/strong>, which may have its own in-house financing or network of lending partners. \u003C/p>\r\n\u003Cp>Another traditional option for car buyers has been to get a car loan pre-approval through a \u003Cstrong>bank or credit union\u003C/strong>. One benefit of going this route is—if you’re working with your own bank—they’ll already have most of the required information on file for you, making the process more straightforward. However, if you have a low credit score, many dealerships, banks, and credit unions may not be prepared to work with you. \u003C/p>\r\n\u003Cp>Getting pre-approved online is an increasingly popular option: either through an \u003Cstrong>online lender or vehicle retailer\u003C/strong>. The benefit of getting a car loan pre-approval online is the low effort and low commitment involved; you can usually complete the process in a matter of minutes—without leaving your home. Additionally, some online providers (such as Canada Drives) are connected with a variety of trusted online lenders (as well as some of the Big Five banks), making it easier to get approved for the best possible rate regardless of your credit situation. \u003C/p>\r\n\u003Ch2>\u003Cstrong>How long does a car loan pre-approval take? \u003C/strong>\u003C/h2>\r\n\u003Cp>Getting pre-approved for a car loan can take as little as a few minutes or up to several days, depending on the lender you’re working with and day of the week. Traditionally, lenders need at least one business day to complete the process, so if you submit the request on a Friday you might not hear anything until after the weekend. \u003C/p>\r\n\u003Cp>If you’re going through a dealership, bank, or credit union, the pre-approval application may need to be done in person but it can sometimes be done online or over the phone. Once the process begins the lender may come back to you with a request for more information or documentation, such as a mortgage statement or utility bill. All in all, you might be waiting for up to a full business day to learn whether you’ve been pre-approved and for how much. \u003C/p>\r\n\u003Cp>With online lenders and online vehicle retailers the pre-approval process is much faster. You can get pre-approved for a car loan online by filling out a short application—which only takes a few minutes—and you’ll get a pre-approval decision almost instantly. \u003C/p>\r\n\u003Ch2>Can I get pre-approved with Canada Drives?\u003C/h2>\r\n\u003Cp>Yes! Canada Drives can get you \u003Ca href=\"https://apply.canadadrives.ca/\">pre-approved\u003C/a> for a car loan online in minutes!\u003C/p>\r\n\u003Cp>With your pre-approval in hand, you’ll be able to shop with more confidence and less stress. You’ll know your exact pre-approved budget, so you don’t have to worry about anything falling through at the last minute.\u003C/p>\r\n","2024-06-03","/uploads/2022/5/6274646aadad7.jpg","/uploads/2022/5/6274646b5dd80.jpg","/uploads/2022/5/6274646b86a4c.jpg","/uploads/2022/5/6274646bbd153.jpg","car loan pre-approval smartphone notification","What Is a Car Loan Pre-approval? (And What’s The Best Way To Get One?) | Canada Drives","Discover what exactly a car loan pre-approval is, where you can get one, and why it's a good idea to get pre-approved before you start your car search. ",5,"2022-05-05 16:57:31","2024-06-03 10:04:43","Jun 3, 2024","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2022/5/6274646bbd153.jpg","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2022/5/6274646b86a4c.jpg","https://cms-blog-uploads-354387082548.s3.us-west-2.amazonaws.com/uploads/2022/5/6274646aadad7.jpg",["Reactive",254],{"$snavigation":255,"$ssite-config":312},[256,261,264,286],{"title":257,"href":258,"rel":259,"getDynamicHref":260},"Get Pre-Approved","https://apply.canadadrives.ca?start=1&SID2=cdoop","nofollow",true,{"title":262,"href":263},"Sell My Car","/sell-my-car",{"title":265,"cardStyles":266,"desktopVisible":267,"hideBorder":267,"menu":268},"Why Canada Drives","why-cd-card",false,[269],{"links":270},[271,276,281],{"title":272,"text":273,"href":274,"icon":275},"How It Works","The easiest way to buy or sell a car","/how-it-works","/svg/nav/cogs.svg",{"title":277,"text":278,"href":279,"icon":280},"Inventory","Get access to the widest selection of vehicles in Canada","/inventory","/svg/nav/car-front.svg",{"title":282,"text":283,"href":284,"icon":285},"Customer Reviews","See why Canada Drives is Canada’s favourite way to buy or sell a car","/reviews","/svg/nav/star.svg",{"title":287,"cardStyles":288,"desktopVisible":267,"hideBorder":267,"menu":289},"Resources","resources-card",[290],{"links":291},[292,297,302,307],{"title":293,"text":294,"href":295,"icon":296},"Research","Stay up to date with the latest auto news, reviews and buying tips","/blog","/svg/nav/lightbulb.svg",{"title":298,"text":299,"href":300,"prefetch":260,"icon":301},"Newsroom","Read news articles about Canada Drives and access our media kit","/newsroom","/svg/nav/newspaper.svg",{"title":303,"text":304,"href":305,"icon":306},"Understanding Car Loans","Learn everything you will ever want to know about car loans","/understanding-car-loans","/svg/nav/dollar-sign.svg",{"title":308,"text":309,"href":310,"icon":311},"Car Loan Calculator","Quickly and simply calculate your potential car loan payments","/car-loan-calculator","/svg/nav/calculator.svg",{"description":313,"env":314,"name":315},"Canada Drives Website (Nuxt)","production","canadadrives-website",["Set"],["ShallowReactive",318],{"LrtT6uwpvC":-1},"/blog/car-finance",{"bbStore":321},{"ConnectionType":322,"fbclid":13,"gclid":13,"isLiveChatLoaded":267,"trackingParams":84,"ttclid":13,"utmCampaign":13,"utmContent":13,"utmMedium":13,"utmSource":13,"utmTerm":13},"unknown connection type"]