There are many benefits to switching from traditional gas-powered vehicles to electric ones. They’re much quieter and produce fewer harmful emissions, helping to reduce our dependence on oil and other fossil fuels that are causing so many environmental problems. And the driving experience is different, too. Electric vehicles have instant torque that allows them to accelerate more quickly and smoothly, and they have regenerative brakes that can use your car’s momentum as it slows down or coasts to create extra electricity.
While you can purchase an electric vehicle outright with cash, most buyers choose to finance their purchases through a loan or lease. It’s important to understand how the differences between buying and leasing an EV affect your financing options so you can make the best choice for your budget and lifestyle.
Whether you’re looking for an electric car loan Hillsboro or a standard auto loan, you can get one from many banks, credit unions, and online lenders. The loans typically have similar terms and interest rates, which are based on your credit score. You can often get a better deal by shopping around for the best rates. And don’t forget to factor in any potential EV incentives that may be available.
The most obvious difference between buying and leasing an EV is that when the term of your leased vehicle ends, you won’t own it. This can be a disadvantage if you’re planning to sell or trade it, since you won’t be able to recoup all the money you put into it. However, you can buy out your lease or turn it in at a dealership, and you can also use the money you saved toward the down payment on another vehicle.
If you opt to buy your EV, you’ll likely need a bigger down payment than you would for a traditional gas-powered vehicle. That can be a challenge if you have a less-than-perfect credit score, and you’ll probably need to improve your credit before applying for an auto loan.
Another difference is that your monthly loan payments will be higher than the lease payments for a financed vehicle. This is because an EV costs more than a comparable gas-powered vehicle. However, if you’re planning on selling or trading your EV later on, you’ll be able to recoup most of the additional cost through that transaction.
EVs give you plenty of warning before they run out of power, so if you do find yourself in that situation you should be able to pull over and charge it up. In addition, many roadside assistance services—including those offered by automakers and insurance companies—will tow your EV to the nearest charging station or send a mobile charger to you.
A green auto loan is a type of traditional auto loan that’s designed to help people make the switch to electric cars. These loans usually offer longer loan terms than standard auto loans, which can help drivers afford a lower monthly payment. They may also have features that aren’t found in standard auto loans, such as including the cost of installing Level 2 charging at home in the loan amount.