 TITLE: Should I Finance or Pay Cash for a Car? CONTENT: When Is It a Good Idea to Finance a Car?\n----------------------------------------\nWhen you finance a car, you're taking out a loan. You might borrow the money directly from a bank, financing company or credit union, or use dealership financing, where the dealer arranges the loan via the financial institution it works with.\nIn any case, you would usually make a down payment, then repay the debt in equal monthly installments over an agreed-upon term (anywhere from 24 to 84 months). The lender may change fees to process the loan, which is added to the balance, and interest is built into the payments. The interest rate you're offered depends on your credit scores and other factors. Higher credit scores could land you lower rates, and vice versa.\nFinancing a car may be a good idea when:\n*   You want to drive a newer car you'd be unable to save up enough cash for in a reasonable amount of time.\n*   The interest rate is low, so the extra costs won't add much to the overall cost of the vehicle.\n*   The regular payments won't add stress to your current or upcoming budget.\n*   Low monthly payments will free up funds for your other necessary expenses.\n*   You're certain you can and will make the payments on time.\n*   You want to enhance your credit history with an installment loan. END