Family spending on car purchases ranks second behind housing. Whether it is a loan for a new car or a used vehicle, certain parameters must be studied.
Taking out a car loan is a two-dimensional business deal called double payment, on the buyer side and on the seller side. It is the preferred business of sellers in a dealership, since the seller gets two commissions and the customer pays two installments, for the car and the credit at the same time!
Car credit: the credit rate also matters
Before applying for a loan, you must take into account: the total cost of the loan and also the interest rate. For this, the legislation has made it compulsory to announce the annual effective annual rate. Thus, the TEG is carried out starting from the totality of the credit cost.
- the sum of the monthly payments
- any costs for opening and closing a file
- stamp fees
- without forgetting the amount of optional insurance.
Auto Credit: Predicting the Worst
It is also necessary to predict possible risks, such as theft and vandalism. Since the damaged customer must still undergo the monthly payments of his credit until compensation for his insurance, the customer will reimburse the amount of the remaining monthly payments, and will assume the penalty for early interruption of credit. Insurance against theft where any risk will prove very useful in this case.
Auto credit: the accumulation of credit repayment with a savings plan
Some banks offer the possibility of associating a car loan with a savings plan. Which makes it possible to obtain interesting facilities. For example, for a monthly loan of 350 dollars , the client will pay 450 dollars each month. The 100 dollars more are used to build up capital allowing to borrow more money, at a better rate or some other advantages…
Car credit: ask dealers for details
All car manufacturers have signed agreements with auto credit agencies. As such, some manufacturers have set up their own lending organizations, with very variable quality of services. For this, a car model that receives little demand is accompanied by attractive proposals. In general, conditions are less favorable in late spring and early summer.
There are loans delayed by 3 months for the first monthly payment or the bridging loan, useful for the purchase of a new car before the sale of the old car, whose classic monthly installments turn out to be economical, compared to large installments. and the amount payable when selling an old car.
Auto credit: other advice…
They are summed up in the correct accuracy of the allocation of the loan (a car loan is often more advantageous than consumer credit). As well for a loan for a new or second-hand car, it is advisable to play the competition, the verification of the duration of loan, the payment of a large deposit on departure and the profit of legal deadline of 7 days of withdrawal.