Vehicle Depreciation

Car Loans Canada offers as introduction to vehicle depreciation. All new car buyers are concerned about the decline of their cars value over the course of its useful life. Anyone considering purchasing a used car will have a better grasp of its worth if they understand how vehicles depreciate. When you purchase a car you pay retail but, the moment you drive off the lot your car is worth its wholesale price. Retail is what you pay when you purchase a car and wholesale is what a car dealer is willing to pay for the car.

Car Loan in Canada

When you apply for a bad credit car loan in Canada lenders will finance the purchase based on a percentage of the wholesale value of the vehicle. A dealer who applies for pre-approval of a Canadian car loan can only arrange financing as long as the sale price (retail) does not exceed the criteria or pre-approved percentage of the wholesale value stipulated by the lender. This wholesale price is often called the black book value because; “The Canadian Black Book” is a company that supplies this data to most dealers and lenders. Black Book determines vehicle’s depreciation based on its condition and on a percentage of it value the previous year. In Canada car loans are subject to a process that will consider the vehicle depreciation in its evaluation. Here are some basics regarding vehicle depreciation:

• A car loses between 15 and 20% of its value each year.
• A 2 year old car is worth 80 to 85% of what its value was after its first year.
• A 3 year old car is worth 80 to 85% of what its value was after its second year.

1 year old used car = $12,000
2 year old used car = $10,200
3 year old used car = $8,670

A new car experiences significant depreciation in it first year because, you have paid retail price and can only recover the wholesale value of your car once you have left the lot.

Car Loans Canada

Borrowers have more options then they have ever had before when applying for a car loan in Canada. Because, there are many more lenders who cater to specialized markets like bad credit or no credit, competition has forced lenders to provide more value.

Car Loans Canada offers access to a network of dealers and lenders that will not only help you get a pre-approve your car loan but, will also give you an accurate evaluation of your trade-in and put you in the vehicle you want at a price you can afford. This network has been very successful at offering good value to their customers.

Join thousands of satisfied customers who have obtained an approved car loan in Canada with one of Car Loans Canada’s specialized lenders and Apply Now! It is fast and easy with Car Loans Canada’s online credit application you can get the get a car loan in Canada without ever leaving the comfort of your home.