The automobile is the second pole of expenditure in the budget of a family after the habitat. An auto loan is often contracted to purchase a vehicle, whether new or used. You have decided to take the plunge and buy a new car? So here for you all you need to know before you enter your credit car.
If you chose to buy a new car, there are several means of financing: personal loan, quick cash loan, credit used, credit balloon or the LOA (hire purchase).
Personal loans are offered by banks and credit institutions. These are the financial institutions that will offer the most competitive offers and lending rates lower. The credit is not linked to the vehicle and you can even borrow more than the amount of the car. The advantage of personal loans from financial institutions is undoubtedly the specialized credit rate is lower than during a credit assigned by the dealer. However, we must be sure to get credit before ordering the car.
The credit is available only assigned in the garage or the dealership that sells you the car. The vehicle and credit are linked, meaning that if the credit is denied, the order will be canceled. And conversely, if the car can not be delivered, the appropriation is canceled. The big advantage is that if obtaining credit is denied, the purchase may be canceled. In contrast, the rates are generally higher than in banks. In addition, the seller is also commissioned on credit, it will be more difficult to negotiate a discount on the price of the vehicle or options.
The ball is usually credit offered by the dealer but can also be sold by banks. The operation is fairly complex: You must sign an agreement to repurchase for a date. At maturity, the seller agrees to return the vehicle to a fixed amount in advance. In return you must make a car in good condition, not rugged, and with a certain mileage calculated in advance … The advantage is the ability to change their vehicles regularly (every 2 or 3 years) But it will be impossible to sell the vehicle whenever you wish. You will have at your back. In addition, you should not exceed the expected mileage or have an accident on pain of financial penalties.
Finally, the LOA lease with option to purchase (lease with promise of sale or lease) is to rent a car for a period ranging from two to five years and may, at the end of the lease, purchase the vehicle for an agreed price in advance. This formula is very interesting because no contribution is payable upon signing the contract.
If you buy a used car in a garage or assigned credit personal loans are the only two choices available to you. As for financing a new vehicle, personal loan agreed in a financial institution or a bank is the best solution. Thus, you can negotiate the price of the car and the rate of your credit with two different parties, which will make trading easier.
Finally, if you purchase your vehicle to an individual, the only financing solution will be the personal loan.
Once you have chosen the type of loan that’s right for you, it will take against the other parameters related to credit. Notably, the rate of credit including interest, which is the most visible indicator of the quality of the offer is made. However, this rate is often misleading and should refer to TEG (percentage rate), which takes into account all the costs. The term of the loan and the amount borrowed can set monthly payments. At most, these payments should not exceed 30% of your income, and even less if you already have credits in progress.
So when you get problem with your payment you can always try to check payday loan at that time.
