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Smart Financing: Why Buying Used Beats the Depreciation Hit

The Strategic Financial Advantage of Financing Pre-Owned Vehicles

At Redwater Dodge, Home of the Rig Ready Rams and Rig Ready Approves, and Rig Ready Used, we believe that buying a vehicle should be as good for your bank account as it is for your lifestyle.

While the allure of a brand-new vehicle is undeniable, a significant shift is happening in the automotive market. Savvy buyers are increasingly turning to pre-owned financing as a tool to maximize value, minimize loss, and drive a higher caliber of vehicle than they thought possible.

Unlock the financial power of pre-owned vehicles. Learn how to avoid the new-car depreciation "pill," secure low rates, and finance trucks as far back as 2005.


Understanding the "Depreciation Pill"

As Jarod at Redwater Dodge notes in our latest financial guide, the most significant barrier to buying new is the immediate loss of value. It is a commonly known reality in the industry: the moment you drive those four tires off the lot, the vehicle takes a substantial "hit" in equity. This is often referred to as the "depreciation pill."


When you finance a new vehicle, you are paying interest on that depreciation. However, when you finance a used vehicle, like a 2021 Ram 1500 or even a well-maintained older model, the previous owner has already absorbed that initial financial blow. You are financing the vehicle based on its stable market value, not an inflated sticker price. This protects your equity and ensures you aren't underwater on your loan the moment you leave the dealership.


Unmatched Flexibility: From 2021 Models to 2005 Classics

One of the most persistent myths in auto sales is that financing is only available for newer cars. At Redwater Dodge, we challenge that limitation. Our finance team has established relationships with lenders who understand the lasting value of Ram Trucks and other durability-focused vehicles.


This allows us to offer financing on inventory that other dealers might turn away.


Late Model Luxury: You can finance practically new vehicles, like a 2021 Ram 1500, often with the balance of the factory warranty intact.

Legacy Power: Uniquely, we can secure financing for vehicles dating as far back as 2005. Whether you are looking for a specific engine generation, a classic body style, or simply a reliable work truck that fits a tighter budget, age is rarely a barrier here.


Rate Parity and Long-Term Solutions

The days of used car loans carrying astronomical interest rates are behind us. With the right credit profile, buyers can secure interest rates on used inventory that rival new car incentives. By combining competitive rates with extended loan terms, we can engineer a monthly payment that fits your cash flow. This approach allows you to upgrade your ride—perhaps moving from a base model to a Laramie or Limited—without stretching your monthly budget.


From deck trucks to SUVs, financing used gives you the freedom to choose the vehicle you want, rather than settling for the one a new-car price tag dictates.


Ready to Finance Your Dream Used Vehicle?

At Redwater Dodge, we believe that purchasing a vehicle should be transparent and accessible, whether it’s brand new or Rig Ready Used.


Contact Us Today at Redwater Dodge for all your Used Vehicle Financing needs:

Call: 780-942-3629 

Common Questions About Financing Used Vehicles

Below, we address the most frequently asked questions regarding used vehicle financing and Rig Ready Approves to help you make an informed decision.


Q1. Is financing a used car harder than financing a new one?

A1. No. The process is virtually identical. We assess your credit profile and the loan-to-value ratio of the vehicle. Because we specialize in used inventory, our finance team is expert at structuring deals that get fast approvals.


Q2. Can I really finance a truck from 2005?

A2. Yes. While most dealers cap financing at 7-10 years, we have lender partners who recognize the longevity of the trucks we sell. If the vehicle passes our inspection, we can usually find a financing solution for it, even if it is nearly 20 years old.


Q3. What does "taking the pill" mean in car buying?

A3."Taking the pill" is industry slang for absorbing the immediate depreciation hit of a new car. A new vehicle can lose 20% or more of its value in the first year. By financing used, you skip this "pill" and pay for the vehicle's current worth.


Q4. Can I get a low interest rate on a used truck?

A4. Absolutely. Interest rates are determined by the lender based on your credit score and the vehicle's year/mileage. We frequently see used car rates that are extremely competitive, sometimes matching new car subvented rates depending on market conditions.


Q5. What is the advantage of a long-term loan on a used car?

A5. Longer terms (such as 72, 84, or even 96 months on specific units) lower your monthly obligation. This improves your monthly cash flow and makes it easier to afford a higher-trim vehicle or a heavy-duty truck needed for work.


Q6. Do you only finance Ram trucks?

A6. No. While we are the Home of the Rig Ready Rams, our used inventory is diverse. We finance SUVs, sedans, deck trucks, and commercial units from various manufacturers. If it’s on our lot, we can finance it.


Q7. Does a used vehicle financing plan include a warranty?

A7. It certainly can. Many of our 2020+ models still have factory warranty remaining. For older vehicles, we can include the cost of an extended service contract (warranty) directly into your monthly financing payment, giving you total peace of mind.


Q8. Can I finance modifications or "Rig Ready" upgrades?

A8. Yes! If you are buying a stock used truck but want to add a lift kit, wheels, and tires, we can often roll the cost of those parts and labor into your auto loan. This is the essence of "Rig Ready"—getting the truck you want, fully built, for one monthly payment.


Q9. Is a down payment required?

A9. Not always. We offer Rig Ready Approves zero-down options for qualified buyers. However, putting money down will always help reduce your monthly payment and total interest paid.


Q10. How do I apply for financing?

A10. You don't need to come in to start. You can view our inventory online and call us at 780-942-3629. We can take a credit application over the phone or through our secure website portal.


Q11. What if I have bad credit?

A11. We work with a vast network of lenders, including prime banks and sub-prime lenders. We specialize in getting people approved regardless of their credit history.


Q12. Why buy from Redwater Dodge instead of a private seller?

A12. When you buy privately, you generally have to pay cash or arrange your own difficult financing, and you have zero protection. When you finance through us, the vehicle is inspected, Lien-checked, and we handle all the bank paperwork for you.