Since the very first car rolled out on the streets, cars have gone through tremendous transformation in the form of power, comfort, safety, fuel efficiency, interiors, and exteriors.
Today, cars are the most common form of transportation and have become a compulsion rather than a requirement. Besides being a compulsory vehicle for office and household works, cars have made traveling less hectic and more convenient. There are cars for the super rich and there are cars for a daily commute. There are cars designed and developed for every purpose. You can buy whatever car you like, but only if you have enough bank balance to do so. If you are concerned finances will keep your first car out of reach, you need not worry. There are easy finance options available to buy your preferred car.
Want to know the whole process?
There are many loan companies, as well as dealers, that have tie-ups with money-lending companies to make the car buying process easy for people who do not have hard cash available. Car loans are the easiest ones to obtain because there is no compulsion to provide income proof, credit scores, asset proof, employment status, insurance, bank statement, etc. as automobile lenders know that not every person meet all the qualifications. All in all, getting a car loan is less painful than a home loan or business loan.
Having a helping hand in terms of an easy car loan has made it possible for people to afford a new car. Here are some insights about how to get the best car loan that you must consider.
What loan amount are you eligible for?
In general terms, the car loan depends on the actual cost of the car, in addition with down payment from your side that you can invest from your pocket. And also with the amount, you can conveniently pay for the monthly repayments. So, all you have to do is to look at your monthly budget, and the savings, so that lenders can figure out the base to lend you the loan for your car purchase.
What type of loan can you opt for?
There are different types of easy car loans to help you opt for the best-suited loan type that meets all your requirements. The four most important ones are a variable loan, a fixed loan, a secured loan, and an unsecured loan.
- Variable loan: In this type of loan, the loan amount varies as per the interest rate adopted by the lender. If they lower the interest rate, the repayment also decreases, and vice versa. But these interest rates are always lower than fixed rates.
- Fixed loan: As the name suggests, the interest rate is fixed for the complete loan tenure. The monthly loan repayment remains the same irrespective of the market rates.
- Secured loan: This loan is more like a bet because it means that you put your desired car at risk. If you don’t repay the loan amount on time, the lender will take back the car. In this loan, the car is used as an asset.
- Unsecured loan: With unsecured loans, there is no compulsion of putting the car at risk, but you have to prove that you are capable of repaying the loan amount on time by showing your credit repayment history or credit card history.
What car brand do you want to buy?
The type of car brand you buy depends on whether you are opting for a new car or if you have selected a used car. For new car loans, refer to the above-mentioned loan types to get a better idea of the kind of loan that works for your budget, lifestyle, and overall financial plans. For used cars, you first have to see whether the car is not too old to pass the car loan eligibility.
What special features are you looking for?
There is an array of various features attached to a car loan, all of which should be considered before purchasing the car you want. Some of these special features include:
- Additional repayment: This loan feature allows you to make additional repayments of your car loan and save money by making complete loan repayment sooner.
- No early repayment penalty: This loan feature allows you to pay off your complete car loan when you have excess money without getting penalized or charged a higher interest rate for early repayment.
You have gone through the types of loans, eligibility, and special features of car loans available to you, now all you have to do is make a final checklist of documents you will need to make the car buying process less painful. Keep your identification documents, proof of income, car details (if you are using it as security for a loan), and credit history record, to see your repayment capability.
Having all these documents on file will help you clear the car buying process and get you in your first car without any additional hassle.