Tips for Getting Car Loans for a Used Car
It is very common to find people with their own vehicles in this modern era. It does not just help to save time when you intend on traveling somewhere, it is also rather convenient. Although every person dreams of owning a brand new car, it is not possible for everyone. The next best option is to go for a used car. Finance options for brand new models are easily available. However, the main challenge lies in getting a proper finance option for buying a used vehicle. Thankfully, there are several tips to help you get a car loan for buying a used car from http://www.buttonwoodfinance.com.au. Some of these tips are discussed below.
- Get All The Possible Financing Quotes: Even before you decide to settle on a company or dealership, it is for your own sake to get all the possible quotes from financers. Choosing the right financer should be like shopping for a large purchase. Some of the factors to consider in this case include a comparison of the loan amount they are willing to offer, the duration of the term, and the interest rate.
- Try and Make a Big Down Payment: When it comes to buying a car, a useful tip is to increase the amount of down payment. Normally, it is said that you should ensure a down payment of around 20% of the total value of the vehicle. The greater the down payment, the more amount will be taken off from your initial loan. Apart from decreasing the payments, it will also affect the rate of interest. If you can ensure a down payment of a minimum of 20% of the total value of the car, you will be able to save a lot in the long run.
- Go For A Non-Recourse Loan: It is needless to say that if you ever default on your car loan, your financer has the right to get the possession of your vehicle. At times, the value of the car will be lesser than the remaining amount of the loan. This will result in a deficit for you. You can easily save yourself from this situation by opting for a non-recourse loan. If you go for such a loan, you will not have to pay the difference during default and you need not have an asset value that will be sufficient to cover the loss.
- Go For A Co-Signer If You Are Young: If you have just started working or practically have no other credit in your name, it may be possible for you to be in a bind. The rate of interest may be pretty high for you, even if you have a secure and well-paying job. In order to avoid this problem, a good solution is to go for a co-signer. Make sure to choose a person to be your co-signer who has an impressive credit history. This may impact the rate of interest on the loan amount and also help you get a lower EMI that you need to pay every month.