What is important when it comes to car loans
The dream of a chic new car can often only be financed with a loan. However, it can also make sense to take out a cheap car loan for the used vehicle. Due to the currently low interest rates, there are many bargains to be made. Because with a loan, car buyers are considered cash payers and can negotiate attractive discounts when buying a vehicle. The following tips should be followed when planning.
By choosing the term, the monthly charge can be adjusted to the financial budget. The longer the selected term, the lower the monthly rate. However, borrowers should keep in mind that the overall cost of a long-term car loan is higher despite the lower monthly rate. With a loan amount of $ 10,000 and a three-year term, $ 288.45 is due. In this example, the total costs amount to $ 10,384. In the case of a 72-month term, only 150 USD have to be paid per month, but the total costs increase to 10,767 USD. In addition, the risk of having to pay the loan even though the vehicle is no longer used increases as the term increases.
A longer term means lower monthly rates with higher total costs
Anyone planning a vehicle purchase should compare the offers of the banks with each other. Even small interest rate differences can have a significant impact on the total costs. With an online loan comparison, interested parties can find the cheapest offer in a few moments.
Check credit bureau data
credit bureau stores data on almost all consumers in Germany. From this information, the so-called credit bureau Score is determined, which can also affect lending and the interest rate offered. Due to the large amount of data, there are unfortunately always incorrect information. Therefore, the stored data should be checked before borrowing. Such self-disclosure is provided once a year free of charge.
Many car dealers lure with so-called zero percent financing. What sounds good at first glance does not always have to be cheaper. The lost interest is often added to the price. Due to the lack of discounts, the total costs are in many cases higher than with a separate car loan.
Zero percent financing is not always worthwhile when buying a vehicle
Loans that can be repaid flexibly offer a number of advantages. For example, if you receive a bonus payment from your employer, you can invest it in the car loan as an additional repayment. Many banks now offer such special repayments without additional fees.
Take out a loan for two
If you take out your car loan together with your partner, you not only increase the chances of getting a permit, in many cases there are also lower interest rates. For example, borrowers pay up to eight percent less interest than individuals on loan contracts between $ 12,000 and $ 15,000. However, it should be noted that both borrowers are fully liable.