Do you want to buy a new car? Then there are different ways to finance this purchase. You can pay for the car with saved money, but this is not always possible for many people. Often there is not enough cash available to save money and sometimes there is also a rush.
In this article we explain which loan is best for taking out a car.
Which loans are suitable for car financing?
There are basically two loans that are suitable for financing a car. These are a:
- Payday loan
- Car financing
- Fifty-fifty deal
With a Payday loan, the amount that you borrow is already fixed. It is a fixed loan and you know exactly how long the term is, how much interest you pay and the amount of the monthly repayment amount. This loan offers you a lot of clarity in advance. So you know what you have to pay and when you have repaid the loan. If you finance the purchase of a car with a Payday loan, the car is also directly yours.
A disadvantage of a Payday loan may be that the repayment term is likely to be longer than the economic life of the car. In addition, it is often not possible to repay extra money in the meantime. You must therefore adhere to the set term.
It is also possible to purchase an installment car from the dealer. A certain interest is charged on this. You can take out such a loan directly from the dealer. You then do not borrow money from the car dealership itself, because it has agreements with a lender. Since the car dealer ‘sells’ the loan to you, you will receive a commission for this from the lender. There is little difference between taking out a Payday loan and taking out a loan with a car dealer. The big difference is that a loan through a car dealer is often more expensive. The interest on a Payday loan is often lower. In addition, you are not always the direct owner of the car. However, this again depends on the conditions.
The fify-fifty deal is nowadays a widely used method in the car industry. You then pay half of the purchase price and the other half in two years. No interest is charged on this. The fifty-fifty deals are offered to car importers. This way of financing a car also seems very attractive, but you can also borrow money here. So it always costs you money. If you have not fully paid off the car within two years, you will often be charged. The remainder is converted into a loan with a high interest rate. A fifty-fifty deal is therefore only an attractive option if you are sure that you can pay off the remaining amount within two years.
Do you want to buy a new car, but don’t have enough cash? Then we advise you to take out a Payday loan. You are then the owner of the car and you know exactly what you have to pay each month and when the loan is fully paid off.
You can take out a Payday loan through one of our intermediaries. We have already listed them for you.