Uncategorized

Four things to look out for when taking out a personal loan for your car

Posted by admin

Are you looking for a car loan? Is your current car really impossible or has it become much too small? Is it a moving barrel and is it almost falling apart? Then it’s time for a new car! Only, it costs a lot of money and it may just be that you don’t have it on the shelf. You can take out a loan to compensate for this. You can of course go to the bank for this, but it is often much cheaper to take out a personal loan. There are a few things to look out for.

The interest

The interest

Borrowing money costs money, and everything you borrow from the lender must also be repaid once. You pay a percentage interest on this amount, this is the profit for the provider and to compensate for the risk that this runs. The interest is calculated on the total amount of the loan for the purchase of your car. In general, this interest rate varies between 0.65% and 5.60%. In short, this means that in total you paid almost 6% more for the car. And considering the purchase costs of a car, this is an amount that can run nicely!

Repay it

Repay it

What you want to prevent in any case is that you get into trouble paying back the car loan. It is therefore important that you calculate in advance how much you will have to pay, how long and whether this is possible with your financial situation. This is also an important parameter for determining how much you can borrow and therefore what type of car you can buy!

The deadlines

The deadlines

Determining how long you will spend on repaying is not the only thing that is important, even in how many months it matters. Some providers count with 10 months per year, which means that eventually you will pay back the same amount per year, but the costs per month may well differ. In addition, the installments determine how long it will take to repay the car loan. There are often different options for this, from 12 months to sometimes 60 (5 years). The amount of installments therefore determine the duration of the loan and the amount that you will determine per month.  

Read the conditions carefully

Read the conditions carefully

The conditions state how long the loan runs, but also how much you have to pay to the credit company. In addition, it contains important information about what happens if, for example, you were unable to repay the entire amount. There can be various consequences here that are important to know well in advance! These may include, for example, collecting the car or other annoying things that you should consider carefully when taking out the loan.