How To Get Car Loans
How To Get Car Loans
Nowadays car loans are much more prevalent than they used to be. So much so that a lot of large car dealerships actually have onsite finance to help people buy the car that they want then and there. If you are not in a hurry then it is always best to do your research thoroughly by reading through the following information about how to get a car loan.
Who Provides Car Loans
Nowadays you can get car loans or finance from any of the major banks, credit unions and building societies. You can also obtain a car loan from a number of other finance companies that specialize in providing car loans to individuals and businesses.
Throughout Australia there are a lot of car finance brokers who will track down the most appropriate loan for your needs and then apply for it on your behalf. You should be aware, however, that these finance brokers will receive a commission from the car loan lender that they recommend to you. For this reason it is a good idea that you double check that the recommended loan is indeed appropriate for your needs. Also ask them what sort of commission they are receiving from the lender and whether or not all car loan lenders provide the same amount of commission.
Main Loan Features to Look For
Car loans are a pretty straight forward type of loan and as such they generally have fewer features. However, the most important features to look out for include :
- The Interest Rate - including any extra ongoing fees.
- Choice of Fixed or Variable interest rates.
- Extra Repayments Allowed - so that you can pay off the loan as soon as possible and save lots on your interest repayments.
- Flexible Repayment Options - can you choose between weekly, fortnightly or monthly repayments, and can the amount be tailored to meet your budget.
- Flexible Loan Term - can you choose the number of years that you would like to pay the loan back over.
Questions When Getting a Car Loan
Whether you are getting a new car loan or a used car loan you should make sure that you get detailed answers to all of the following questions.
- What is the interest rate for the car loan?
- Can I choose how number of years that the loan is to be paid back over?
- Can I make extra payments of any amount at any time?
- Is it possible to qualify for a lower interest rate?
- Is the interest rate fixed or is it subject to change?
- If the interest rate is variable then how much notice is given before it changes?
- If the loan is for a fixed term, what rate will the loan revert to when it is over?
- What happens to the loan if the car is in an accident?
- What happens to the loan if I miss a payment?
- What is the minimum loan amount that you must borrow?
- What is the maximum amount that you can borrow?
- Exactly what documentation must be produced to get the car loan approved?
- How long will it take for the loan to be approved?
- Can I get my finance pre-approved before purchasing a car?
- How long does pre-approval last?
- Can I buy the car for anywhere (ie: dealership or private)?
- Are there any penalties for paying outthe loan early?
- Are there any monthly administration fees?
- Are there any other ongoing bank fees?
What you Need to Get a Car Loan
There are a number of things that you will need in order to get a car loan in Australia. Some of these items will vary from lender to lender, but as a general rule you will require the following things to get a car loan :
- Although a deposit is generally not required it is a good idea to have one so that you can save on the total cost of the car. A deposit also proves that you have a good savings record, although you can prove this by simply showing details of your bank savings accounts.
- Estimates of your living expenses, including rent, mortgage repayments and any other amounts that you have to pay on a regular basis.
- Details of any assets that you own, such as a house, land or another car.
- Proof of employment including how long you have worked there and how much you earn (not including overtime).
- Documentation about any other loans that you have including your personal or home loans.
- After you have got the car loan you might need to prove your identity with a 100 point ID check. For this you will need things like your driver's licence, bank or credit cards, medicare card, household bills or birth certificate.
If you are unsure about the meaning of some of the terms or abbreviations used by car loan lenders then you can check out the car loan terminology page, which has a detailed explaination about some of the more confusing aspects of getting a car loan.
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