Electric Car Loan Interest Rate in Canada: What You Should Know

Posted : May 23, 2024
Electric car loan interest rate

With electric cars in Canada becoming popular, it comes with various incentives, fees and rebates. People have started choosing electric cars over petrol cars. Considering the initial cost of buying an electric car, people seem to like getting a car loan for it. The electric car loan interest rate lies between 7.15% and 7.50% per annum; this may vary. It is calculated depending on the quantum.

Where Can You Get an Electric Car Loan Financed?

There are 3 places where you can apply for a car loan to buy the best electric cars in Canada. However, you must consider the pros and cons of every place before applying for any of them.

Dealership: Many auto dealers offer in-house financing for electric car loans in Canada. The dealership offers a credit facility which is convenient for you to apply for a car loan. It helps in giving you a high chance of receiving additional perks after you make a down payment. You can trade your used cars as well. You must know that the facility of credit comes with a high rate of interest and a short term of repayment between 1 and 5 years.

Bank & Credit Union: To apply for any type of financing, considering financial institutions is the best option. They are capable of providing large amount of loans at low interest loans for electric carsThe term of repayment is longer than any other place. Initially, it might get difficult for you to apply for a loan if you are not a member or have a low credit score. With proper guidance, things could be easier.

Alternative lenders: It is the best option for low-income people or people with low credit scores. The alternative lenders have flexible loan approval requirements as compared to other financial institutions.

In order to qualify for the best electric car loan interest rate, you can opt for a personal loan.

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Cost of Financing an Electric Car

To know the cost of electric cars in Canadayou must take into consideration additional costs, interest rates, fees and down payment costs that come with it.

Down payment: Down payment is the amount which a buyer pays to dealership for the approval of the loan. The amount should be at least 10% to 20% of the original car sales price.

Fees: You are required to pay some amount of additional fees while getting an electric car loan. These are document costs and loan processing costs. You might be required to pay pre-delivery inspection fees and some amount of maintenance costs as well.

Interest rate: There is no doubt that interest rate increases the cost of your loan. The interest rates of electric cars are fixed; however, they can be flexible too. It depends on the negotiations made by the customers. Having a low or bad credit score makes you eligible for having a high rate of interest.

To get the best electric car finance deals, make sure to do thorough research for financing options you have. It is advisable to compare rates and deals offered by different lenders and understand the eligibility criteria and documentation associated with each.

Jack Fortin
Auto Finance Expert

Jack Fortin is one the leading car loan and auto finance experts in British Columbia, Canada. He loves to write and share car loan news and updates.

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