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Paying for Your First or Next Mobility Vehicle: Know Your Options
Cash
Throwing down a stack of bills is the cheapest way to buy a mobility vehicle, and perhaps the most thrilling,but most likely not the best use of your money. Put the same amount of cash toward your home mortgage, and pay off years of interest. Or invest the cash wisely in mutual funds, and watch your account balances grow. While a car sits in your driveway depreciating, these investments work to make you wealthier and can offset your interest costs.
Your Credit
At Midwest Mobility we offer credit tips and explain how to get the best interest rate by reviewing your credit history and help increase your score, and help correct mistakes on your credit report. Most people do not have the experience to correctly understand the report or understand what the funding source is really determining the approval and interest rate from. Often times people have the misconception of their credit score and (DTI) debt-to-income factor. A larger down payment or trade-in can make a huge difference on your loan approval, term length and interest rate.
BUYING TIPS-
REQUEST A CREDIT REPORT
The Bank
For a great interest rate, a local bank may be your best bet. Because bank rates are linked to the prime rate, they often offer the best available interest rate, especially when rates are declining. Also, a long-term relationship with a local bank can be useful if you ever get in over your head or if you’ve got small blips in your credit history. Read more in our Auto Loans section. LOAN vs LEASING
The Credit Union
When the prime rate is going up, be sure to check out the loan options at local credit unions. Because most credit union rates are tied to bonds, not the prime rate, they escalate at a slower pace. And if you’ve got less-than-stellar credit, these loans may offer you more flexible terms. Just be aware of the "Right of Offset" clause in these loans, which allows the credit union to seize your deposited funds if you default on your loan.
The Mobility Dealer
Most Mobility Dealers do not offer financing. At Midwest Mobility we have several financing sources, including reduced-rate manufacturer loans. You may have to consent to a shorter term or make a bigger down payment, but these loans can save you thousands if you qualify. We also offer easy, one-stop financing through local banks. Because of our relationships and volume of business with these banks, we qualify for the best rates, and we can advocate for customers with marginal credit. ON-LINE CREDIT APPLICATION
Mobility Lease Plan
Do you typically own a car for less than four years? Do you need a vehicle for 1-3 years? Do you like to keep a warranty? Do you drive less than 12,000 miles per year? If you answered yes to these questions, leasing may be the right move for you. When you lease a vehicle, your payments are almost always lower than conventional financing. And if you use the car for business, part of your lease may also qualify as a tax deduction. LEARN MORE
Your Home Equity
Some of the interest on a home equity loan is tax-deductible, which makes this a tempting option for buying a mobility vehicle. But there are some facts to consider. By applying a depreciating asset to your home mortgage, you’ll pay interest for the entire life of the mortgage on a vehicle. You’ll also significantly decrease the amount of home equity you have available for home repairs, major life changes, and emergencies.
Your Investment Equity
You may be able to borrow against a retirement fund, life insurance policy, or another appreciating investment to purchase your mobility vehicle. Just remember that you’re decreasing or losing your ability to tap those funds in the event of an emergency. |
