auto loan rates

Todd D Bertshinger asked:




Dealer ads frequently announce “the best used car loan rates available”, but the interest rates differ enormously, so how do you know who is telling the truth?

And it is not just the auto dealerships who put out billboards offering the best car loan rates in town, finance companies and a variety of other financial institutions go down the same path.

So, short of getting out your financial calculator to work out the maths, how does anyone in the market to buy a used car know if they are getting the ‘real deal’?

While the solution to finding the best used car loan rates in Australia may not require a calculator, it does require some research if you want to reap the benefits.

Many people head to their bank or credit union initially. While the major banks, and more particularly the credit unions, offer very competitive rates for used car loans, their lending guidelines are very stringent, making it virtually impossible for the average guy in the street to meet the qualifications.

So, back to the car dealerships or the local used car lot, where car finance is readily available – generally with a hefty fee for service or interest rates that would leave the proverbial loan shark slack-jawed! But that is not always the case; the large, prestigious used car dealerships generally work in partnership with one of the large finance companies and occasionally you will find used car loan rates that are close-to-competitive.

In many cases, the loan rate offered will depend on how badly the dealership wants to sell you the car and whether the markup on the vehicle you want to purchase is sufficient to make their sales quota for the week. In the majority of cases, the dealership earns a commission on every new used car loan they initiate, so they are going to get you – one way or another.

Savvy buyers are now going online to find the best used car loan rates available by using one of the quality loan providers/brokers. Online loan providers take all the hard work out of comparing used car loans and rates between various financial institutions by doing the comparison shopping for you.

In most cases, online used car loan providers work with a variety of lending institutions who offer a number of different loan products. By completing an online form that requests personal and financial details, the loan provider can assess your circumstances and current position and then determine which of the lenders they have agreements with will provide the best match for your individual needs.

Some of the criteria they take into account are:

The deposit you have available

* Your current employment status

* Your ability to repay the loan

* Your previous credit history

* The market value of the car and the amount you want to borrow

* The term over which you would like to repay the loan

* How old the used car is

The most important factors are a stable employment history, a sound credit rating and the ability to repay the loan over a reasonable period of time. Many online loan providers guarantee to get back to you within 24 to 48 hours with an answer. This time is necessary for them to verify and confirm the financial information you have provided.

Because the loan providers have contracts with a number of financial institutions, they can use their network of lenders to obtain the best used car loan for the amount you want to borrow, the required loan term and the monthly repayment schedule.

So if you have been pulling your hair out looking for the best loan rates, you can put down your calculator and grab your computer mouse instead and head online. All the work is already done for you, so you can relax in the comfort of your office chair while browsing the Internet and not only find the best used car loans in Australia, but the best used car loan rates as well. Now, isn’t that a pleasant thought?

Theodore