CAR LOAN
Shopping around for the best car loan can save you thousands in interest and fees.
A car loan is a personal loan for a new or used car. You have to repay the loan and interest over a fixed term, usually between one and seven years.
Shopping around for the best car loan can save you thousands in interest and fees.
A car loan is a personal loan for a new or used car. You have to repay the loan and interest over a fixed term, usually between one and seven years.
Most people shop around before they choose a car. You should also shop around before you choose a car loan. It can save you thousands in interest and help you pay off your car faster.
Compare loans before visiting a car dealer
It's important to look at loans before you go to a car dealership. You'll be able to negotiate better, as you'll know:
exactly how much you can spend
the best interest rate you can get
how much your repayments will be
Car dealerships will try to sell you add-on car insurance. This includes loan protection, gap cover, and tyre and rim protection. These products are not good value for money. Don't feel pressured to buy them.
Fixed or variable interest rate
With a fixed interest rate, the interest rate and your car loan repayments are fixed and won't change. You'll know exactly how much will come out of your bank account for repayments each month. Car dealerships usually offer fixed rate loans.
With a variable interest rate, your car loan repayments can change if interest rates change. If interest rates rise, your repayments will be higher. If interest rates fall, your repayments will go down.
Variable rate car loans usually don't have an early exit fee
. This might be better if you're planning to make extra repayments and pay the car loan back early.
