To limit the cost of buying your car as much as possible, you can negotiate your car loan. Follow our tracks to benefit from a cheap car loan.
A car loan is a loan used to purchase a car. It can finance the entire amount of the vehicle, with a ceiling of $ 75,000 and a reimbursement period which can reach 84 months. As an assigned loan, the car loan has a few special features: the reimbursement does not begin until the delivery of the car.
AUTO CREDIT: THE MOST POPULAR OF CONSUMER CREDITS
If the vehicle is not delivered, the car loan can, therefore, be canceled, free of charge. The average amount of a car loan is around $ 13,000. The car loan represents half of the consumer loans contracted in France.
Dealers regularly offer financing solutions to buyers, but an individual has the right to choose a car loan from the organization of his choice, and can even freely call the loan between individuals.
NEGOTIATING A CAR CREDIT: A COMPETITIVE MARKET
Auto credit generally offers the lowest interest rate among the various consumer loans and for good reason: it is highly competitive. The borrower is therefore in a position of strength to negotiate car credit if it is based on this competitive market.
Dealer, banks, lenders, online collaborative credit platforms: carry out simulations and requests for quotes, and share them with the various players involved in order to obtain the most competitive car loan possible.
NEGOTIATING A CAR CREDIT: BUILDING ON YOUR ASSETS
Negotiation is a face-to-face exchange between a buyer and a seller. The buyer – or rather the borrower – can demand that his interlocutor provide him with his most attractive offer, with the agreement of his hierarchy. For this – and while putting the forms there, it can rely on:
• loyalty, if he has already taken out loans in the past;
• the proper management of its accounts, based on the elements provided with a loan request (bank account statements);
• its solvency and its low debt ratio, on the basis of its supporting documents to be provided for a loan request (salary slips).
A good customer and a low-risk customer encourage lending institutions to offer advantageous conditions to attract them.
NEGOTIATING A CAR CREDIT: THE BENEFITS OF PERSONAL CONTRIBUTION
The lower the amount to borrow, the less expensive the car loan is! A good way to reduce the amount to borrow is to have a personal contribution. Ideally, it should represent 10% to 20% of the price of the car. This personal contribution has a double effect:
• it reduces the amount to borrow;
• it reassures the lending institution about the good management of the borrower, by demonstrating its ability to save. This promotes better loan conditions.
NEGOTIATE A CAR CREDIT: REDUCE THE REPAYMENT PERIOD
The interest rate soars with the duration of repayment of the car loan. The shorter the repayment period, the lower the rate! To reduce the repayment period, it is, therefore, necessary to increase the amount of the monthly payments as much as possible, within the limit of the debt ratio accepted by the lending institution (generally one-third of the income).
NEGOTIATE A CAR CREDIT: FROM THE SALE PRICE OF THE VEHICLE
The sale price of the car largely determines the amount to borrow for a car loan. And it is precisely he who certainly has the greatest room for maneuver in terms of negotiation! Whether buying a new or used car, it is always possible to get a discount.
Here too, the competition must be made to work (in particular for the new) and be based on vehicle faults (for the occasion), possibly negotiating the price of the car license. It is all the more possible to negotiate the price of a new car when it comes to a vehicle with options and a maintenance package.