3 Tips To Get The Best Car Loan

3 Tips To Get The Best Car Loan

When you are out to buy a car, you might need some finance to help you make the purchase. Here are some things to think about so that you get a loan that suits you.

1. Figure out a comfortable loan term:

Before applying for a car loan, please think how the repayments could affect you financially over time.  Will servicing the loan become a real burden?

Write down your outgoing expenses:

  • insurance
  • other loans you’re paying off
  • living expenses

before working out a repayment amount that you can afford. This helps you narrow down your ideal borrowing term.

The longer the term, the lower the repayments. But, that also means you’ll pay more interest in the long run.

2. Understand insurance options:

When you buy a vehicle, you’ll also need to obtain the right insurance cover for your needs. Understanding how much you’ll need to set aside for insurance payments could affect what you end up borrowing. Insurance can also help to provide peace of mind when you take out a loan.

Comprehensive car insurance will cover the replacement cost of a vehicle if it’s stolen or written off, or if you crash or damage it. You may be given the option to insure your vehicle for its market value or another nominated amount.

GAP insurance is the difference between an insurance payout of a vehicle and the balance still owed on the financing. If you are financing a car, for example, GAP insurance may save you thousands of dollars if your car is written off and you still owe money on it.

Consumer credit insurance (or CCI) is insurance that protects you if you are suddenly unable to make loan repayments.  Example: in the case of unemployment or illness. Or sometimes you might be injured in an accident. Or you might want to protect your family in case you die.

3. Get another quote [other than your car dealer]:

You have a number of options when looking to finance a vehicle. Getting a finance quote at the dealership where you are buying the car from may seem like a convenient option, but it may not be the cheapest one.

Also enquire with a broker.  Brokers have access to a range of different lenders and financial products. A broker will assess your personal situation to see which product suits you best.

Buying a car is always exciting, so if you do your homework, understand your options and are comfortable with the loan you’re taking, you’ll be in the best position to enjoy the experience.

If you want more information about how you can find the right car loan that’s right for you, please contact one of our finance consultants on 1300 123 863. Or, submit a quick quote enquiry and we will get in touch with you.

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