Your 84-Month Used Car Loan Estimate for Quebec with a 700+ Credit Score
You're in an excellent position. With a credit score over 700, you have access to the most competitive interest rates from prime lenders in Quebec. This calculator is tailored to your specific situation: financing a used vehicle over an 84-month term. Let's break down what these numbers mean for your budget and how to leverage your strong credit profile.
How This Calculator Works for You
This tool provides a clear estimate of your monthly payments based on the vehicle price you enter. Here's what's happening behind the scenes:
- Vehicle Price: The total cost of the car you're considering.
- Credit Profile (700+): We've factored in a competitive interest rate range, typically between 6.99% and 9.99% (OAC) for a used car on an extended term. Your final rate will depend on the lender, the vehicle's age, and your overall financial profile.
- Loan Term (84 Months): This longer term spreads the cost out, resulting in a lower monthly payment. We'll discuss the pros and cons of this below.
- Taxes (Quebec): This calculator is set to 0% tax to show you the principal and interest payment on the vehicle's price alone. Crucially, you must remember that Quebec Sales Tax (QST) and GST (a combined ~15%) will be added to the final purchase price at the dealership. Be sure to factor this into your total loan amount.
Approval Odds: Very High
With a 700+ credit score, your approval odds are excellent. Lenders see you as a low-risk borrower. They will primarily focus on two things:
- Income Stability: Verifiable income that shows you can comfortably afford the payment. Whether you're a traditional employee or self-employed, demonstrating consistent earnings is key. For more on this, see our guide: Self-Employed? Your Bank Doesn't Need a Resume.
- Debt-to-Service Ratio (DSR): Lenders want to see that your total monthly debt payments (including this new car loan) don't exceed a certain percentage of your gross monthly income, usually around 40-45%.
Your strong credit often means more flexibility. For instance, a large down payment may not be necessary. Many of our clients with great credit get approved with zero down. In fact, sometimes Your Down Payment Just Called In Sick. Get Your Car.
The 84-Month Term on a Used Car: A Strategic Choice
Opting for a 7-year loan is a popular way to manage monthly cash flow. However, it's important to understand the trade-offs, especially with a used vehicle.
- Pro: Lower Monthly Payments. This is the main benefit, making a more expensive vehicle feel more affordable on a month-to-month basis.
- Con: Higher Total Interest. You will pay more in interest over the life of the loan compared to a shorter term (e.g., 60 months).
- Con: Negative Equity Risk. Cars depreciate. Over a long term, you might owe more on the loan than the car is worth for a longer period. This can be a problem if you need to sell or trade the vehicle early.
- Lender Constraints: Lenders may have age and mileage restrictions for used cars on an 84-month term. A newer, low-mileage used car is more likely to qualify.
Example Payment Scenarios in Quebec
Let's look at some realistic estimates for an 84-month term with a good credit score. We'll use a sample interest rate of 8.49% (OAC) for this calculation. Remember, these figures do not include QST/GST.
| Vehicle Price (Before Tax) | Estimated Monthly Payment | Total Interest Paid (Over 84 Months) |
|---|---|---|
| $20,000 | ~$316 | ~$6,544 |
| $25,000 | ~$395 | ~$8,180 |
| $30,000 | ~$474 | ~$9,816 |
| $35,000 | ~$553 | ~$11,452 |
Disclaimer: These calculations are estimates for illustrative purposes only. Your actual payment and interest rate will vary based on the final approved terms (OAC).
Even if you've had credit challenges in the past, a high score today puts you in control. We believe in second chances and understand that a past consumer proposal doesn't define your future. To learn more, read about how Your Consumer Proposal? We Don't Judge Your Drive.
Frequently Asked Questions
What interest rate can I expect in Quebec with a 700+ credit score?
For a used car on an 84-month term, borrowers with a 700+ credit score can typically expect prime rates. These can range from approximately 6.99% to 9.99%, depending on the specific lender, the age and mileage of the vehicle, and your overall financial health (like your income and other debts). Banks and credit unions generally offer the most competitive rates.
Is an 84-month loan a good idea for a used car?
It can be, but it requires careful consideration. The main advantage is a lower monthly payment, which helps with budgeting. The disadvantages are paying more total interest over the loan's life and a higher risk of being in a negative equity position (owing more than the car is worth). It's best suited for newer, reliable used cars that you plan to keep for the entire loan term.
Do I need a down payment with a 700+ credit score in Quebec?
Often, no. A high credit score gives you significant leverage, and many lenders will approve a loan for 100% of the vehicle's value (plus taxes and fees) without requiring a down payment. However, making a down payment is still a smart financial move as it reduces your loan amount, lowers your monthly payment, and helps you build equity faster.
How do taxes work on a used car loan in Quebec?
When you buy a used car from a dealership in Quebec, you must pay both the federal Goods and Services Tax (GST) of 5% and the Quebec Sales Tax (QST) of 9.975%. This combined tax is calculated on the sale price and is typically rolled into your total loan amount, increasing your monthly payment.
Can I get approved for an 84-month loan on any used car?
Not always. Lenders have specific criteria for long-term financing on used vehicles. They often impose limits on the car's age (e.g., no older than 5-7 years) and mileage (e.g., under 100,000-120,000 km) to ensure the vehicle remains reliable for the duration of the loan. A very old or high-mileage car would likely not qualify for an 84-month term.
