Car values to consider for bad credit auto financing

Whenever you are considering purchasing a vehicle, you should also consider how well that vehicle holds its value. The reason is that someday you are going to want to sell or trade that vehicle. And, the better a vehicle is at holding value, the higher the price you’ll get when you sell it or trade it in. The Kelly Blue Book annual list of best vehicle resale values is a good resource to check before purchasing a car and obtaining bad credit auto financing.

There’s a difference between the price and the cost of a car even when financing with poor credit, car loans. We know this because for the last few years at Federal Auto Loan, we’ve been helping applicants find quality lender or dealer partners that support bad credit, car loan programs. Our website also provides information on good and bad credit auto loans, repossession, bankruptcy, and today’s topics and tips on choosing the right car.

More than just the price.

If you are only considering the price in what a vehicle is going to cost you, you are making a mistake. There is far more to a vehicle’s cost than just the price on the sticker in the window. A better thing to consider is the idea of “Total Cost of Ownership,” which takes into account a number of other things that “cost you” including: fuel efficiency, reliability, maintenance costs, and, especially, depreciation.

Depreciation is the declining value of a vehicle over time. According to those in the know at Kelley Blue Book (, during the typical five-year ownership period of a car, its loss in value (depreciation) is usually the biggest expense of all. Depreciation is also one area where car buyers can save money simply by choosing a model that loses less of its value than other vehicles in the same category.

Kelley Blue Book Projections

The staff at Kelly Blue Book has created categories of vehicles that project how well a car or truck will do in terms of overall resale value. They award “honor vehicles expected to maintain the greatest proportion of their original retail price after five years of ownership.” These are good vehicles for consideration if you are considering purchasing a vehicle.
So, when you are researching your vehicle, take some time to review the projections of resale value on the Kelly Blue Book website. You may find that the car or truck you want isn’t nearly as good of a deal over time as you thought.

Watch the repairs

In addition to depreciation, some vehicles are just better made than others. Those vehicles will cost less over time to repair. And that will save you money over the long run. On the other hand, vehicles with bad reputations in terms of repair problems will cost you more. So research the car you are considering to make sure it isn’t going to hammer you with repair bills. You’ll be glad you did.

How much is the maintenance?

Beyond repairs, some vehicles simply cost more to maintain. This may be due to the way they are engineered or because they require special products (such as more expensive oil) as part of their maintenance, or both. For example, there are some vehicles that require considerably more work than others just to change the spark plugs. So unless you can afford to pay a lot for maintenance, don’t buy the vehicle that costs a lot to maintain.

Gas mileage

With the cost of fuel these days, fuel-efficiency is very important to most vehicle buyers. For example, let’s say you can afford a monthly payment of around $200, and your current car takes about $400 a month to fuel up. Under this scenario, you are spending $600 a month to drive that vehicle (excluding repairs and maintenance). On the other hand, if you dump that vehicle and buy a car that costs $250 a month to fuel up, you could actually afford a higher payment (and perhaps get a better vehicle). So, when you are looking at a car, make sure you check how fuel-efficient it is as well. Doing so could save you a lot over the time you own the car.

The Bottom Line

Never confuse cost with price. The price is what you pay for the car, while the cost is what you’ll end up paying over the lifetime of the vehicle ownership.

You should also know that at Federal Auto Loan, we place applicants with bad auto credit with dealers that can offer them their best chance at getting approved for no credit, and bad credit auto loans.

So, if you’re ready to begin rebuilding your car credit, you can begin now by filling out our online, bad credit, car loans application.

Get on the road today.


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