affordable car insurance

Car makers in the United States are in dire straights. Both Chrysler and General Motors have been in Washington DC to request government loans to help them get back on their feet. Without a loan, they risk going bankrupt and laying off thousands of workers. The long term shock waves could affect car dealership, car accessory manufacturers and auto shops. Despite strong indications over the years that the American auto makers should shift focus to more energy efficient and smaller cars, their slow response to change left them behind foreign competitors. Recent economic developments hit the already struggling GM hard. In addition, consumers are now more reluctant to jump into auto loans, financing and new car purchases.

GM is undertaking various incentives to entice consumers into buying from them. The company is offering big cash rebates for customers and has expanded its employee discounts. One program even allows dealers and current and retired employees to offer employee discounts to friends and family. Some credit unions have joined forces with GM to provide auto loans at lower rates. The partnership is called “Invest in America.” It will offer lower interest rates on auto loans and significant discounts on the retail prices of GM cars. It is estimated that the venture will offer $10 billion in auto loans to consumers. The deals and auto loans will begin in the Midwest, and are anticipated to expand to the rest of the country. Additional auto loans and great deals may abound in 2009, as speculation circulates that the other two big auto makers are discussing a similar deals with credit unions.

Time will tell if offering consumers discounts and great rates on auto loans will be enough to give American car companies the boost in sales they need. The major U.S. car manufacturers are hoping that a combination of boost in sales, modifications to their business strategies and a loan from the government will be enough to help them out of troubled waters. The once almighty big three auto manufacturers are now analyzing the business models of foreign car companies to chart a course ahead. The crises these companies are confronting will cause them to change or disappear. Hopefully it is not the latter, as the affects would be devastating to so many associated businesses and workers.

The auto manufacturers in this country are in dire financial straits right now and car companies are, consequently, pulling out all the stops on deals on new cars. They are hoping to breathe some life into the struggling car market by enticing consumers to purchase. Many potential car buyers have been hesitant to buy a new model from a company that might not make it through the current market woes. For many buyers, however, the unprecedented bargains may be too good to pass up. The first thing to consider when shopping for a new car is whether you want to pay for the car by taking on a car loan or paying with cash up front. Each method has advantages and disadvantages and you need to do what is right for your financial situation.

Most consumers who do not have a large sum of cash on hand choose to instead take on a car loan. Before you take on a car loan, however, you should be comfortable with the monthly payment you will take on. There are many choices for a car loan and you will want to spend the time to find a good rate and terms. A dealer will frequently try to give you a better financing rate with them, if they know what rates and terms you have found from other lenders. When you do your budget calculations, do not forget to include costs for registration, title, inspections and licensing. The obvious benefit of a car loan over paying cash is that you only have to pay for the car a little at a time. You get to drive off the lot with a car, but do not have to put a large short term dent in your wallet. But there are disadvantages to a car loan. The car will not be owned by you nor will you possess the title, until you have paid the loan balance. You will actually pay more for the car than you would if you were paying cash, because you will be paying interest and other fees. If your financial situation changes and you can no longer afford the car loan payments, you will have to sell the car to pay off the loan.

Buying a car with cash is the most uncomplicated option. Decide what you want, then save or set aside the funds. You go to the car lot, give them the money and drive away with a car that you own outright. There are no strings attached. No need to research rates or fees or terms. You do not have to pay extra for the car in the form of interest payments. You own the title. And, when the car depreciates, you will not be stuck with a car that is valued at less than the car loan. The only disadvantage to this method is the potential that investing the large sum of cash elsewhere might earn more money over the long term than you would have put into car loan payments.