Car Buy on Credit – But what should you pay attention to? – Car Loans

With the classic loan, the full purchase price is usually paid. Have you ever had the idea of ​​making money buying your car? Different shopping worlds in Switzerland.

Be careful when buying a car – always use special loans!

Be careful when buying a car - always use special loans!

The flexibility that is advantageous at first glance can prove to be a cost driver when buying a car. Dedicated car loans have several advantages in this regard. According to an investigation by the Austrian National Bank, the number of new registrations in the first half of 2016 rose by 6.3% compared to the previous year.

But car buyers should take a closer look at the type of financing so that they don’t end up spending too high an interest rate. What is the difference between a special auto loan? A car loan and a conventional installment are only different in terms of purpose. What appears to be irrelevant at first glance has far-reaching effects in reality: – The house bank knows from the intended purpose that the funds are used to acquire new assets.

  • This could convert the vehicle into cash even in an emergency, to at least partially replace the car loan. – In connection with a type approval registration, the vehicle can also be converted into a legal credit protection. These effects at least seemingly reduce the likelihood of a vehicle loan default. This ensures that car loans can often be available at a slightly lower price than traditional installment loans.

The interest rate differential is ultimately quite small.

The interest rate differential is ultimately quite small.

The deviation is often between 0.5 and 1 percentage point and not every house bank makes special offers. However, what at first sounds more like mini savings potential can prove to be significant savings over the term of the loan.

Because many banks also offer special auto loans, the application process is often just as easy as with a normal installment loan. Opt for particularly advantageous dealer financing. Almost every car dealership today also enables financing to be obtained directly from specialist dealers. Very often very attractive interest rates are offered there.

But with the use of dealer financing, the cash payer discount disappears. Are the savings from the cash payer discount greater than from the more favorable interest conditions for dealer financing? As a rule, the answer to this question is not to be understood in general terms, but always depends on the circumstances of the individual case: Anyone who has to do with a car loan will usually also take an appropriate financing option.

Instead of flexibility rates, interested parties should prefer to use dedicated auto loans. In contrast to trade finance, it should always be examined which variant is more advantageous. Accordingly, either the bank loan with cash payer discount or the particularly advantageous dealer financing is used. With a certain planning effort, you can ultimately make your own vehicle financing more affordable than it appears at first glance.

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