Around two thirds of the cars registered in Germany were financed.
However, the statistics do not differentiate between leased vehicles and cars that were paid for using a classic loan. Financing a new car, be it a real new car or a new car, is obvious.
Those who want to save on a new car will hardly reach their destination due to the current low deposit rates. The savings hardly grow and will be even less due to the loss of purchasing power, and the prices for cars will rise. The discrepancy between the balance and the purchase price increases from year to year.
Financing turns out to be a more sensible solution. Against the backdrop of a variety of options, of course, the question arises, how a buyer finds the right car loan.
- 1.) Dealers advertise with dream financing, partly with the famous zero percent financing. But that should not deceive buyers. Often a part of the purchase price for the car subsidizes the ostensibly non-existent interest on the car loan. In addition, dealer financing is set extremely short, the installment is correspondingly high.
- 2.) Balloon loans, which are also offered by numerous banks, are an alternative. For example, if the loan is agreed over a period of three years, the final installment is equal to the residual value of the car. The buyer can now decide to return the cart, to replace the final installment, the balloon rate, in one sum, or to continue this as a renewed loan in the form of follow-up financing.
- 3.) Basically, any form of loan that is not dealer financing will give the buyer better negotiating potential. Cash payment was and still is the beating argument for achieving a discount on car purchases.
- 4.) Who is looking for a new car, usually takes time and compares the offers very thoroughly. After all, it’s about a lot of money. It is annoying when, after the purchase and the concluded loan agreement, it becomes apparent that a loan that has been over-priced again puts the savings on the purchase into perspective. A credit comparison calculator helps to prevent this error.
- 5.) Car loans are granted in most cases on more favorable terms, as a credit for the account balance or a fitted kitchen. The background is that the car letter is deposited as security.
- A bank always assumes that a loan is not returned properly. By assigning the car letter, however, the bank can resell the car at any time, a circumstance that is not the case with a kitchen.
Further criteria for selecting the appropriate financing
In addition to interest rates, other criteria often play a role in the selection of funding. One of them is the term. Not all providers provide the loans with the same maturity. While some banks only lead for 84 months, others give their clients up to 120 months of credit, such as here.
Decisive for the selection of the institute can also be the possibility of early repayment of the car loan without calculation of a prepayment penalty.
However, almost all banks today make it possible for a special repayment to take place once a year. The amount is in most cases 50 percent of the remaining debt.
This can be interesting, especially with long loan terms, since the initially higher, maturity-dependent interest rate can be compensated over time.