Financing a new golf cart is usually more affordable each month than financing a used one. Lenders often offer promotional rates on new models, sometimes as low as 0% APR, which lowers the monthly payment.
Used carts tend to come with higher interest rates and shorter loan terms, which can increase what you pay every month. The right choice for you depends on your budget, credit history, and how you plan to use the cart.
Keep reading to see the key differences and find the financing path that fits your situation.
Key Takeaways
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New carts often have lower promotional interest rates, making monthly payments more manageable.
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Used carts usually require higher interest rates and larger down payments from lenders.
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Your choice should be based on your budget, credit score, and long-term ownership plans.
Is It Cheaper to Finance a New or Used Golf Cart?
Financing a new golf cart is often cheaper each month. That’s mainly because of the interest rates you can get.
Lenders and manufacturers frequently offer promotional financing on new inventory, which is why many buyers start by comparing new vs used golf carts before deciding which option makes more financial sense.
Some dealers and manufacturers may offer promotional 0%-3.99% APR for new carts, but terms depend on credit and program availability. These low rates directly result in a lower monthly payment for the same loan amount.
“Lenders offer better rates on new vehicles because they’re easier to value and lower risk. In many cases, promotional incentives like 0% or low-interest financing can make a new model cheaper to finance than a used one for buyers with good credit.” - Investopedia [1]
Financing a used golf cart presents a different financial picture. Lenders view a pre-owned vehicle as a higher risk.
The cart is older, may be out of warranty, and its future reliability is less certain. To offset this risk, lenders charge higher interest rates. Used cart loan rates can be higher than for new carts, often starting in the mid-to-high single digits and increasing based on credit and lender.
Furthermore, used cart loans often have shorter typical terms, though some lenders may offer terms up to ~60 months
A shorter term combined with a higher rate means your monthly payment for a used cart can be surprisingly high, even if the total loan amount is smaller.
How Do Interest Rates and Loan Terms Compare?
A loan is defined by its interest rate and its term. Those two factors are where financing for a new and a used cart differ the most. Understanding that difference is important for your budget.
For a new golf cart, you usually get better terms. Loan terms for new carts may go up to around 72-84 months with some lenders, depending on price and borrower credit.
The interest rates on these loans are often subsidized by manufacturers or their finance partners, which is why many buyers lean toward electric golf carts that pair predictable financing with quiet performance and lower long-term operating costs.
Financing for a used golf cart works differently. Lenders will usually offer shorter terms, often between 12 and 48 months.
The interest rates are almost always higher because the cart is older, it's the lender's collateral, and it's worth less and could need more repairs.
Some lenders may require a larger down payment to reduce risk, especially for older carts; down payments commonly range from about 10-20%, though higher amounts can be requested.
For illustration, a $10,000 cart financed at a lower rate and longer term will likely have a lower payment than a similar amount at a higher rate and shorter term; actual rates vary.
|
Feature |
New Golf Cart Financing |
Used Golf Cart Financing |
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Typical APR |
0%-3.99% promotional (with approved credit) |
6%-12%+ depending on lender and credit |
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Loan Terms |
Up to 72-84 months |
Usually 12-48 months |
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Down Payment |
Often low or optional |
Commonly 10%-20% or more |
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Monthly Payment |
Lower due to long terms and low rates |
Higher due to shorter terms and higher APR |
|
Warranty |
Full manufacturer warranty |
Often expired or limited |
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Lender Risk |
Lower |
Higher |
Why Do Lenders Prefer Financing New Models Over Used Ones?
Lenders manage risk. From their point of view, a new golf cart is a much safer loan than a used one. A few key factors create this preference, and they directly affect the rates and terms you get.
The manufacturer’s warranty
A new cart comes with a factory warranty, often covering the battery and powertrain for several years. This protects the lender’s investment, if a major part fails, the manufacturer pays for the repair.
That means the cart is more likely to stay working and hold its value during the loan. A used cart, especially one out of warranty, doesn’t have that protection.
A sudden $1,500 battery replacement could strain the owner’s budget and increase the risk they can’t pay the loan.
Stronger, more predictable resale value
New carts from known brands hold their value better and have more predictable resale prices,especially popular layouts like 6 seater golf carts, which lenders favor because they appeal to families, guests, and small groups while maintaining steady demand.
If a borrower doesn’t pay, the lender can repossess the cart and sell it to get their money back. A used cart has already lost a lot of value. Its price is less certain and could be low, especially if it needs repairs.
To cover that uncertainty, lenders charge a higher interest rate and often ask for a larger down payment, so the borrower has more equity in the cart from the start.
What Hidden Costs Should You Budget For?
The purchase price and monthly loan payment are only part of the total cost. Both new and used carts come with additional, often overlooked expenses that need to be in your budget.
“Financing increases the total cost of the vehicle because you're also paying for the cost of credit, including interest. Low monthly payment offers may be tempting but often have longer loan periods and higher interest rates, which means they're much more expensive overall.” - Federal Trade Commission [2]
Additional costs for a new golf cart
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Registration and title fees to make it legal.
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Insurance, which is mandatory if the cart is street-legal. Costs can vary.
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An extended warranty beyond the factory period, if you choose it.
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Custom accessories like upgraded lights or a stereo, paid out-of-pocket.
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Annual maintenance like tire rotations, brake checks, and software updates. Costs are usually low at first.
Additional costs for a used golf cart. These costs are often higher and less predictable, which is why understanding the pros and cons of used golf carts upfront can help you avoid surprises later.
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A professional inspection before you buy, typically $100-$200.
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Battery replacement every 4-5 years if it has lead-acid batteries, costing $1,000-$2,000. Lithium batteries last longer but cost much more to replace.
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Other potential repairs like new tires, brake work, controller issues, or cosmetic fixes.
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Insurance, still required for street-legal models.
These unpredictable repair costs are the financial risk that makes lenders charge higher interest rates for used cart loans.
Should You Choose New or Used Based on Your Usage?
How you plan to use the golf cart is a good guide for choosing between new and used financing. The right choice matches the cart’s reliability to your needs and fits your budget, especially once you understand what to check on a used golf cart before committing to a pre-owned model.
When financing a new cart is often the better choice
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For frequent use or business purposes like rentals or resort transport.
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When lower monthly payments from promotional rates help your cash flow.
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When you want the peace of mind of a full manufacturer’s warranty during the loan.
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When reliability and a professional appearance directly affect customer satisfaction or revenue.
When a used cart might fit your situation
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For very occasional, personal use on a strict upfront budget.
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If you can pay with cash to avoid financing costs entirely.
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If you need to finance a used cart, be prepared with a larger down payment (20-30% or more) to offset the higher interest rate and keep the loan small.
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This path is best if your main goal is the lowest total loan amount, not the lowest monthly payment, and you’re comfortable handling potential repairs yourself.
FAQ
Is financing easier for new golf carts or used golf carts?
Financing depends on your credit score, down payment, and overall credit profile. New golf carts usually qualify for competitive rates, flexible terms, and manufacturer warranties.
Used golf carts, including pre-owned golf carts from a private seller or private party, often require secured loans or personal loans.
Always compare interest rates, loan terms, and monthly payments before starting the application process.
How do interest rates and loan terms affect monthly golf cart payments?
Interest rates, loan terms, and your debt-to-income ratio directly impact monthly payments. Dealer financing and dealer-assisted financing may include extended warranties and a transparent experience.
Private party purchases depend more on your credit score and insurance coverage. A higher down payment usually lowers interest costs.
Always confirm prepayment penalties, insurance costs, and minimum purchase requirements before committing.
Can you customize pre-owned golf carts like new golf carts?
Yes, many pre-owned carts allow customization options such as custom seats, lift kits, weather enclosures, LED lights, Bluetooth speakers, body panels, lighting packages, suspension systems, braking systems, utility beds, and lithium batteries.
While new golf carts include manufacturer warranties, used golf carts can still be street legal and environmentally friendly. Always schedule a test drive and request maintenance records before buying.
Which option offers better resale value: new or used golf carts?
Resale value depends on condition, demand in the pre-owned market, and documented maintenance records. New golf carts lose value faster during the first years of ownership.
Used golf carts usually provide better cost savings and steadier resale potential. Features such as electric golf cart systems, street legal upgrades, clean body panels, and professional inspections can improve resale value.
What should buyers expect during the golf cart financing application process?
Buyers should expect a review of their credit score, debt-to-income ratio, and financial goals. Most golf cart dealers provide personalized assistance, explain financing options, secured loans, lease-to-own agreements, and auto loans, and outline insurance coverage requirements.
Prepare maintenance records, inspection checklists, and proof of income. Clear communication helps align monthly payments with resale potential and recreational needs.
Making Your Golf Cart Financing Decision
Choosing how to finance a golf cart balances immediate costs with long-term value. New cart financing usually has lower rates and longer terms, making payments easier and including a full warranty. Used financing offers a lower price upfront but comes with higher interest and more risk from repairs.
Your personal finances, credit score, down payment, and monthly budget, matter most. We suggest getting pre-qualified to see your real numbers for each option. For more details and to explore customizable new carts, you can view the full collection at Backyard Escapism.
References
1. https://www.investopedia.com/articles/pf/07/neworusedcar.asp
2. https://consumer.ftc.gov/articles/buying-used-car-dealer