What is purchase financing?
- Purchase financing is an installment sale transaction between you and your dealer whereby you agree to pay the amount financed, plus an agreed-upon finance charge, over a period of time.
- Most banks, trust companies and automotive financing companies offer traditional financing.
How does financing work?
- With traditional financing, your up-front costs will likely include a down payment, registration fees and other charges (such as licensing).
- After that, your monthly payments are based on the amount you need to finance, plus interest, over a set period of time.
- At any point during your payment period, you can choose to sell your vehicle or trade it in for a new one.
- Once your payment period ends, you will own your car outright.
Fixed vs. variable interest rates
When choosing to finance, it's important to understand the difference between fixed and variable interest rates.
Fixed interest rate:
- Just like it sounds, your interest rate is set for the full term of your loan.
- Fixed interest rates are often set higher than variable interest rates (at least initially) but they protect you from market fluctuations.
Variable interest rate:
- A variable interest rate means that if interest rates drop, you benefit. But if they rise, you either pay more or extend your loan term.
- Fortunately, many financial service providers will let you switch between the two without a penalty.
The benefits of purchase financing
When you purchase finance a new
- You have the freedom to drive your vehicle for more than just a few years.
- You don't have to worry about the possible penalties of a lease (i.e. excess wear and extra mileage charges).
- You can customize your vehicle and alter its appearance.
- You own your vehicle at the end of your contract term.
- You have the flexibility to sell or trade in your vehicle at any time during your contract term.
- Your payments can be spread over a longer period of time, you can make lower monthly payments than you would if you had chosen to lease.
- You can get loan pre-approval from your lender before you go car-shopping, which means you'll know in advance how much you can spend and what your monthly payment will be.
Take advantage of our online tools
Find a vehicle that fits your budget and your lifestyle by taking advantage of our online tools.
Request a Quote
Build your Vehicle
Transferring your loan
During the course of your finance contract, your circumstances may change, requiring you to find somebody to take over your loan. What should you do?
- Once you have found someone who would like to take over your loan, he or she will need to visit a local GM Dealer to complete a credit application.
- Upon approval, your financial service provider will transfer your vehicle's ownership to the new owner.
- There may be a transfer fee, which covers all costs related to lien registration, credit analysis, document preparation, life/disability cancellations, internal record modifications, mailings and insurance verification.
- Once you've transferred your ownership, you're no longer responsible for the vehicle or loan.
Changing your payment date
Many financial service providers can accommodate you if you'd like to change your payment due date. Simply contact them directly to find out the conditions and steps to follow.
Deferring a payment
If you need to defer a payment to the end of your loan, your financial service providers can help. Please contact them directly to find out how to proceed.
And once you have provided them with all the required documents and met all the conditions (including any applicable fees), your monthly payment will be added to the end of your loan. In other words, the term of your loan will be extended.
Paying off your loan early
Many financial service providers allow you to:
- Terminate your loan whenever you want
- Make a lump sum payment in order to pay off your loan sooner - with no penalty
Contact your financial service provider for more details.
Appraising the value of your vehicle
Knowing the value of your vehicle can be very useful if you plan to sell it privately or trade it in for a newer model.
- If you underestimate your vehicle's value, it will sell too quickly - at too low a price.
- If you overestimate the amount, your car won't sell immediately and you could be forced to sell it at a price well below its value.
To quickly determine the estimated trade-in value of your vehicle in Canadian dollars, use the Canadian Black Book Web tool.
Protecting your vehicle with an extended warranty
If your manufacturer warranty has expired, then even one major repair can add up to more than the cost of an extended warranty.
Find out more about extending your warranty
Trading up to a new
If the amount you owe on your vehicle is less than what your vehicle is worth, then you may want to think about trading it in for a newer model.
Here are a few helpful hints that can help you maximize your vehicle trading value:
- If you've purchased a new vehicle and financed more than 80% of the total price, trading too early in your loan contract may result in a deficit. You may still owe more than the trade value of the car (in other words, you'll be in a negative equity position).
- When you have enough equity in the vehicle (when you're in a balanced equity or positive equity position), you should discuss trading in your vehicle for a newer
your local GM Dealer.
Making your final payment
If you're almost at the end of your loan, you may be thinking about buying a new vehicle. We have a new Cadillac lineup that we're sure you'll love, plus an exclusive offer for Cadillac owners that you're not going to want to pass up.
GM Smart Purchase® Financing is a new and affordable financing option that offers an alternative to lease financing. This flexible loan product lets you own your vehicle, while still allowing you to return it for a predetermined price at a date agreed upon within your contract.
By taking advantage of GM Smart Purchase® Financing, you may exercise an option to return your vehicle for sale to Ally Credit®, during a specific timeframe as stated in your contract. The purchase price will be subject to a $199 disposal fee, and will be adjusted to account for any excess wear or kilometres.
If you decide to keep your vehicle, there will be no safety inspections, taxes or additional fees applied.
What are some of the features of GM Smart Purchase® Financing?
- A fixed rate over the entire term of the contract
- No down payment required on approved credit by Ally Credit®
- A 36, 48 or 60 month Smart Purchase® Option Date, where you can return your vehicle for sale to Ally Credit, continue your payments, or trade in your vehicle to a GM Dealer.
- Available in all provinces and territories
What are the customer benefits of GM Smart Purchase® Financing?
- Low monthly payments
- You own your vehicle
- Have the ability to get in to a new vehicle more often
- Multiple choices at the Option Date
- Product is completely open, so it can be paid down or off at any time without penalty
- Available on all 2010/2011 MY Chevrolet, GMC, Buick, GMC and Cadillac vehicles
‡ GM Smart Purchase® financing is available on approved credit through Ally Credit. Eligible vehicles: 2010/2011 MY new or demonstrator Chevrolet/Buick/GMC/Cadillac. Dealer order (2011MY only) or trade may be required. Limited quantities of certain 2010 models. Applies only to qualified retail customers in Canada.
Payments amortized over a term of up to 84 months. At months 35-37, 47-49 or 59-61 customer may: (i) exercise option to return vehicle for sale to Ally Credit if applicable conditions met, including payment of $199 disposal fee and any excess wear/km charges; (ii) continue at initial payment amount for remainder of term; or (iii) trade-in vehicle to dealer.
This offer may not be combined with certain other consumer incentives available on GM vehicles. GMCL or Ally Credit may modify, extend or terminate this offer in whole or in part at any time without notice. Conditions and limitations apply. See your dealer for details.
When you lease
a new Cadillac
Do you like driving a new vehicle every few years? Then leasing may be right for you.
When you lease a new eligible Buick or Cadillac:
- You get to drive a new vehicle more often
- You don't have to worry about resale or trade-in hassles
- You are only paying for the portion of the vehicle's value that you intend to use
To learn more about the benefits of leasing,
Discover the Virtual Showroom
See our entire
lineup in the Virtual Showroom and search for vehicles based on body style, price, seating capacity and more.
Discover our new lineup
Locate a Dealer
If you're looking to purchase a new car or truck or if you'd like service for your current
vehicle, our network of dealers is ready to assist you.
Enter your Postal Code
If you have any more questions that haven't been addressed on this site, please consult our Frequently Asked Questions. You can also contact us directly and speak to one of our Customer Care Ambassadors on our Live Chat.