The car loan is a form of financing dedicated to the provision of a capital for the purchase of a car, considering the high prices and the consequent impossibility for many to buy it in cash. Precisely for this reason, auto loans come on the market with different variations and elements that characterize the method of disbursement of the capital, the amount of the installments, the interest rate and the amortization plan of the amount financed.
There are numerous types of car loans that the various banking institutes, dealerships or financial companies offer by exploiting various solutions in the granting of credit, in the search for requirements and guarantees that protect the provider in the event of insolvency, considering the possibility of obtaining a car loan even in 24 hours or without special guarantees. Let’s find out about the different types of car loans on the market, the conditions and risk policies of each loan adopted by the banking institutions that offer them and the advantages to be able to better choose the solution that best suits your needs.
The car loan: WHAT FINANCES DO YOU NEED?
Before choosing the car loan solution that best suits your needs, you need to assess how much liquidity you have available to cover the cost of the car. It is in fact possible to obtain greater reductions based on the economic availability that the buyer has to pay without considering the capital paid by the financial body : the concessionaire is usually more inclined to make his offer if his client shows to have money in cash which implies the reduction of loan disbursement times.
If, on the other hand, you do not have a liquid sum, the car loan is granted anyway, but other types of solutions will have to be evaluated to obtain substantial reductions: the concessionary financial products will be offered in the concessionary. If, on the other hand, you have reservations about choosing a banking institution that has an agreement with the concessionaire in question and you want to choose another financial institution (perhaps the one with which you have already applied for a loan previously) you can obtain a liquid capital to be paid directly into dealer with a single solution.
With the choice of another dealership, obtaining a liquid capital equal to the amount necessary for the purchase of the car in cash, entails numerous concessions from the concessionaire (usually) which, as mentioned above, is much more inclined to offer a reduction in the price of the good when it pays in cash.
TO CONSIDER : there is also to consider the fact that even with the choice of the financial agreement by the concessionaire, the same owner has incentives on the number of customers to whom he can propose that type of finance.
The car loan THROUGH THE DEALER: A LOAN PROPOSAL WITH FACILITIES
The car loan proposed by the dealer is the simplest and most immediate solution to purchase the good. The loan beneficiary customer only has to stipulate the contract and pay the loan installments, which is established on the basis of installments and amortization plan that are sustainable for his monthly remuneration. This is because the capital paid by the financial institution is paid directly to the owner of the concessionaire, paying off the cost of the car in a single payment.
With the car loan solution with the concessionaire, the conditions for returning the capital are facilitated based on the chosen financial company. Usually, zero-rate financing solutions are proposed that allow you to buy the car with an interest rate of zero, even if it is necessary to count the practical and administrative opening costs that lead the loan to have an increase in the repayment of the amount actually disbursed.
In general, the customer who chooses to buy the car with the car loan agreement with the concessionaire has benefits on the interest rate but also on the amount of the monthly installment. on the market there are proposals for 100-150 USD a month, which also allow those who have reduced economic possibilities (or other financing in progress) to buy the car they want.
One of the reasons for the dealers’ propensity to grant car loans even with very low amounts is the fact that they receive commissions in the sale of financial products offered by the financial companies with which they are affiliated; in addition to the fact that the capital to cover the total cost of the car is paid directly to the concessionaire, 3-5 days after acceptance of the loan.
The car loan AGREED WITH THE DEALER: TABLE
To better understand the characteristics of car dealership loans, also observe the following table which highlights the main points of this type of loan, the method of disbursement and repayment of capital and the advantages for the customer, the concessionaire and the financial agreement:
|CAR LOAN AGREED WITH THE DEALER||FEATURES AND BENEFITS||CAPITAL DELIVERY METHOD|
||CAPITAL EQUAL TO THE PRICE OF THE CAR PAID BY THE FINANCIAL INSTITUTE TO THE DEALER|
|REDUCED INTEREST RATE AND ZERO RATE FINANCING RATE||THE DEALER RECEIVES COMMISSIONS ON THE BASIS OF THE NUMBER OF FINANCIAL ASSIGNED||DELIVERY WITHIN 3-5 DAYS FROM LOAN ACCEPTANCE|
The car loan with FINANCIAL OF TRUST: WELDING DIRECTLY THE COST OF THE CAR
If you do not want to accept the proposal to subscribe to a financial company at the dealership where you buy the car, you can also choose to take out a car loan from a trusted finance company. In this way, after obtaining the loan, it is possible to apply directly to the dealership and pay off the total price of the car in a single payment. This car loan solution is particularly convenient for the customer who has already contracted a loan with the financial energy to which he is turning: very often in fact the financial companies grant, to their customers, loans with subsidized rates.
By choosing a trusted financial company for the subscription of a car loan, it provides a longer waiting time (equal to a minimum of 3-5 days) to obtain the capital on your current account. Only after having received the bank transfer it is possible to start the car purchase procedures. From this point of view, the loan with the concessionaire is faster (even if only for a few days, since, also in this case, it is necessary to wait for the acceptance of the loan) and the practices are started at the same time as when the intention to purchase is expressed.
The car loan with ASSIGNMENT OF THE FIFTH: THE SOLUTION FOR THE PROTESTED
The auto loan with a fifth assignment is an ideal financing method for individuals with permanent contracts but above all for protesters or those who have been included in the list of bad payers. The method of returning the capital has in fact greater guarantees: the monthly payment is deducted directly from the salary and the employer directly pays the amount due to the financial institution.
With the transfer of the fifth, however, there are limitations in the subscription of the car loan as the monthly payment cannot exceed the maximum amount of 1/5 of the salary : the financeable capital for the purchase of the car is therefore in proportion to the remuneration of the customer and cannot exceed the 10-year amortization plan. But there are also advantages: car loan with employee loans is also granted to people with fixed-term employment contract, establishing a repayment plan that does not exceed the duration of the employment contract.
To better understand, observe the following table which summarizes the characteristics of the car loan with the sale of the fifth :
|LOAN CAR WITH ASSIGNMENT OF THE FIFTH||FEATURES||LIMITS|
|FINANCING WITH DIRECT DELIVERY TO THE DEALER||MAXIMUM MONTHLY INSTALLMENT OF 1/5 OF THE SALARY||MONTHLY INSTALLMENT UP TO A MAXIMUM OF 1/5 OF THE SALARY|
|IDEAL SOLUTION FOR:
MAXIMUM INSTALLATION OF 240 USD
|THE MONTHLY SUM IS DIRECTLY DEDUCTED BY SALARY||REFUND PLAN UP TO 10 YEARS|
The car loan WITHOUT AVAILABLE LIQUIDITY and HIGH AMOUNT: IS IT POSSIBLE?
It is the case in which you fall in love with a beautiful car, you would like to apply for a loan, but the request for capital exceeds the maximum sustainable threshold with our monthly remuneration and you don’t even have a liquid sum available to cover a part of the car price or as a guarantee of the financial institution. How can you get a car loan in this case? The solution in this case is the request for the financing method with the assignment of the fifth but with the possibility of having further guarantees for the financial institution in the event of insolvency or, without these, change the method of repayment of the loan. Let’s go into more detail.
The auto loan with salary assignment provides that the maximum transferable installment is 1/5: with 1,500 USD per month net of remuneration you can at most have an installment amount of 300 USD. With a brief calculation it is easy to understand that, if the fifth assignment admits a repayment plan of a maximum of 10 years, it is not possible to request the financing of 50,000 USD, for example. This sum is beyond the maximum threshold allowed. In this case there are two solutions : choose a loan with bills of exchange that replace the installment and have an enforceable title; have a guarantor.
CHOOSE THE CAR LOAN WITH EXCHANGE : you must have a real estate property that is the guarantee for the lender in case of insolvency. The bill of exchange is to be intended as the monthly installment but with enforceable title, or the possibility of the financial company to make claims against the property subject to guarantee.
CHOOSE THE CAR LOAN WITH GUARANTEE : you must request the second signature of a person with a permanent contract, who assumes responsibility for the balance of the capital in the event of insolvency.
“CON PAPA ‘” car loan: THE FINANCING WITH GUARANTEE
The car loan solution with guarantor is the form of financing necessary for young people, but also for adults who do not have a contract of employment with sufficient pay or atypical work contracts, for the purchase of a car. If the young person or the person who intends to buy a car through a loan does not have the requisites to access consumer credit, he can request the loan using a guarantor who could be the father.
In this way, the car loan with guarantor has greater guarantees of acceptance for the applicant but also a greater propensity for the financial institution that acquires greater security in the return of the capital. Notwithstanding the fact that the father, or the guarantor, has the task of paying off the contracted debt in the event of non-payment, for which he must have financial resources, a permanent contract or a pension. To summarize, also observe the following table:
|CAR LOAN WITH GUARANTEE||ROLE OF THE GUARANTEE||GUARANTEE REQUIREMENTS|
|SUBJECT WITH ATYPIC OR TEMPORARY WORK CONTRACT||WELDING DEBT IN THE EVENT OF INSOLVENCY||INDETERMINATE TIME CONTRACT OR PENSION|
|THE FATHER AS A GUARANTEE||FINANCIAL RESOURCES|
LOAN CAR WITH ASSIGNMENT OF THE FIFTH: CHANGE AND / OR GUARANTEE IF THE COST IS HIGH
To better understand and summarize, also observe the following table which summarizes the characteristics of the car loan with salary-backed loan in the event that the sum requested is above the threshold established by the maximum disbursable capital and the requisites and guarantees required to obtain the financing:
|LOAN CAR WITH ASSIGNMENT OF THE FIFTH||CAPITAL DELIVERY BY THE FINANCIAL COMPANY||REQUIREMENTS and GUARANTEES|
|LOAN WITH LIQUID AVAILABLE SUM||RESIDUAL CAPITAL TO COVER THE COST OF THE CAR||GOOD PROPERTY|
|LOAN WITHOUT LIQUID AMOUNT AVAILABLE||TOTAL CAPITAL TO COVER THE COST OF THE CAR||OTHER GUARANTEES FOR THE SALE OF THE FIFTH WITH SUM AS WELL AS THE THRESHOLD OF THE LEGISLATION:
The car loan with MAXI RATE FINALE: MONTHLY installments + DEBT OF THE DEBT
The maxi car loan with final installment is the financing solution for color that, at the time of purchase, expects to have in the future an economic availability that will allow it to pay off the debt in a single solution. This type of car loan with maxi final installment includes a repayment plan divided into two phases: the first characterized by the repayment of the capital with monthly installments; the second one with the possibility to choose the total extinction of the debt or even continue to pay the monthly installments.
The car loan with maxi final installment is ideal for the purchase of cars of medium-high value: the amount of the installments is low and for this financing solution ideal also for the subject that often changes cars or buys a used car (of lower price than a new car). To better understand, also observe the following table which summarizes the main features of this type of car loan with maxi final installment :
|LOAN CAR WITH MAXI RATE FINAL||FIRST REFUND PHASE||SECOND STAGE OF REFUND|
|IDEAL FINANCING FOR THOSE WHO ACCOUNT OF HAVING IN THE FUTURE THE ECONOMIC AVAILABILITY FOR WELDING THE DEBT||MONTHLY RATES||DEBT OF DEBT IN ONE SOLUTION|
|POSSIBILITY OF CHOICE BETWEEN installments and DEBT OF DEBT IN THE SECOND STAGE OF THE REFUND PLAN||CONTINUE TO PAY THE RESIDUE installments|
The car loan with LEASING: WHO IS THE CAR?
The car loan with Leasing is a ” form of financing with fee ” which provides a contract under which a finance company buys the car in question and assigns its use to a company for a set period of time. The company corresponds to a sum established in the contract which constitutes a rent : at the end of the lease period the company using the car has the possibility of becoming the owner of the property by paying ” the redemption “, or the established sum, always when signing the car loan agreement with Leasing.
With the type of car purchase with Leasing you can get the car you want or need without problems of cost: financing the entire amount of the vehicle is ALWAYS POSSIBLE, excluding the sum to be paid to acquire ownership of the car. Furthermore, it is also possible, during the payment of the fee, to change the amount or pay the fee to be paid in advance, starting the procedures to get ownership of the car.
|LOAN AUTO LOAN||OPERATION OF LEASING||DETAILS|
|FIRST PHASE||THE FINANCIAL COMPANY PURCHASES THE CAR||GRANTING ENTITY|
|SECOND PHASE||THE FINANCIAL COMPANY SELLS THE USE OF THE CAR BEHIND THE PAYMENT OF A FEE FOR A PERIOD OF TIME||IT’S POSSIBLE:
|THIRD PHASE||AT THE END OF THE PLAN ESTABLISHED YOU CAN BECOME OWNERS OF THE CAR BEHIND THE PAYMENT OF THE RESIDUAL SUM||YOU BECOME OWNERS OF THE CAR|