Coronavirus and Cars: Is now the right time to buy a car?
June 5, 20209:38 am
2 min read
After the coronavirus economy is now the right time to buy a car?
The economy has been a rollercoaster since the coronavirus pandemic took hold, but during all of the uncertainty is it a good time to buy a car?
Ivan McBride, vice president of auto lending products and sales, at PenFed Credit Union says yes.
Preparing yourself to go into a dealership with the right information takes work though.
It’s important to benchmark with a financier that gives true data coming from dealerships and then to find the same data from a one-price store.
From there it is just a matter of getting a dealership to agree to the numbers you’ve brought in.
But once you have a car in mind there’s still the matter of paying for it and cars are getting more expensive.
“Average transaction prices are anywhere between, let’s say $30,000 to $35,000 for the average vehicle sold in the U.S., and that’s because there’s a lot of new technology on vehicles,” McBride said. “There’s a lot of new safety features. Vehicles from all manufacturers are pretty much loaded now with a lot of great equipment, so we’re seeing average transaction prices go up.”
Car buyers have lots of options for loans to pay for those cars. Leonard suggests not getting locked into longer loans.
“I would max out at 72 months, that’s probably the most I would ever want a car loan for,” he said.
There are also some unique ways to finance a car. Leonard said people can lease cars, put a certain mileage on it each year and then pay off the residual balance of the lease with a loan to own the car.
McBride said in a COVID-19 world that many people are now thinking about buying used cars as an option too. McBride said people are wary of going on subways and buses and getting in Ubers while coronavirus still infects people. He said a used car may be a good option for them.
“If it’s a two year old vehicle, it could have up to 30,000 miles and still be considered lower mileage vehicle. Those are great buying opportunities,” McBride said.
Of course, if you already own a car and things are too expensive there’s also the option to refinance.
McBride said it’s important to consistently check rates for better offers.
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Vice President, Automotive Lending Products and Sales, PenFed Credit Union