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Out of nearly 60 car brands that sell in Canada, Subaru ranks among the top 15. Just south of the border, USA Today reported that Subaru ranks number three in customer satisfaction among car manufacturers. If you’re interested in buying one of these mid-range cars, you have a few financing options to consider. Though Subaru is pricier than some of the competition, its vehicles come with a solid warranty and you could even score a special rate discount.
You can finance your Subaru a few ways: a car loan, manufacturer financing or a personal loan. A car loan is generally the least expensive option. Not only will you be taking out a secured loan, which typically has lower rates than an unsecured (no collateral) personal loan, but you’ll also cut out the middleman. This means no tacked-on interest to cover the dealership’s costs.
However, getting a car loan may not be your quickest option. To find the best deal, you’ll have to compare rates from different online lenders, banks and credit unions. If you’re pressed for time, you may want to get a loan directly through Subaru Financial Services, which is funded by Toyota Credit Canada Inc. (TCCI). You can apply for financing when you pick out your car, and then drive off the lot the same day — no waiting period is required.
Layla, a resident of Saskatchewan, recently graduated with her undergraduate degree and plans to complete a Master’s program at a university an hour away from where she lives. Knowing she’ll have a lengthy commute – sometimes in bad weather – Layla hunts around for a safe and sturdy vehicle, eventually landing on a 2020 Subaru Forester at a nearby dealership. She decides to buy the SUV, priced at $30,800.00, and makes a 20% down payment of $6,160.00.
Layla applies for dealership financing to cover the remaining $24,640.00. Thanks to her solid credit history, she is approved for a loan to cover this amount plus 6% PST. Layla is also charged a mandatory registration and insurance fee of $1,160.00/year (about $100.00/month) by Saskatchewan Government Insurance (SGI). This fee factors in a discount of almost $260.00 due to Layla’s high safety rating, which she earned over 10+ years of being a great driver with no incidents, suspensions or collisions.
|Cost of new car||$30,800.00|
|Loan type||Auto loan (term loan)|
|Interest rate (APR)||5.90%|
|Loan term||5 years|
|Additional fees||4.00% origination fee ($1,059.52)|
|Payment||$510.86 monthly or $235.51 biweekly|
|Total loan cost||$30,651.60 with monthly payments or $30,616.30 with biweekly payments|
*The information in this example, including rates, fees and terms, is provided as a representative transaction. The actual cost of the product may vary depending on the retailer, the product specs and other factors.
Subaru offers a 1% Loyalty Bonus interest rate reduction for returning customers who take advantage of any of the company’s special offers. This discount applies to both financing and leasing agreements. Additionally, customers in the following categories can get a $750 rebate on their vehicle purchases:
Looking at the manufacturer suggested retail prices (MSRPs) of some of the models you’re interested in can give you an idea of how much you’ll need to borrow. However, the actual cost of your new Subaru will depend on your negotiating skills, where you live and any special promotions you qualify for.
|2019 model||Starting MSRP||Body||City/highway MPG|
Subaru also offers the following limited warranties:
In order to not be charged for these repairs, you need to bring your car to an authorized Subaru retailer in Canada.
Although Subarus can be a bit pricier than the competition, you may qualify for one of the brand’s special buyer programs to help bring the cost down. And if you’re buying a Certified Pre-owned car directly through Subaru, you may be able to find a car that’s still under warranty. Financing directly through Subaru Financial Services may be your fastest option, but you could likely find a more competitive rate by comparing car loans from banks and online lenders first.
Learn more about how they work and compare your options with our guide to car loans.
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