5 Things You Must Understand Before Applying for a Car Loan

5 Things You Must Understand Before Applying for a Car Loan

We always compromise with our wish when we don’t have fund to fulfill our dream. But in recent times we don’t need to sacrifice our dream especially if it is the matter of the car we want to own. When it comes to buying a car it is the standard that all buyers follow is applying for a car loan.

Financing a car is something which is pretty complicated but you should be well aware about the payment options, mode and the most importantly amount. A professional business advisor helps in finding various sources. There are many things that you should know while financing a car, but now we are going to discuss about the top 5 things.

5 Things You Must Understand Before Applying for a Car Loan

  • Price of the car
  • Check the offer properly
  • Financing option
  • Hidden Charges
  • Warranty period
car loan

Price of the Car

The price of the car is the main factor as the sticker price is not the real price. Before buying the car you should bargain about the price. But you cannot do it if the dealer doesn’t entertain the haggle.

If it is not so then you can always go ahead and do that. If they get the hint that you have an urgency to buy a car then they will definitely entertain your bargain and make you buy the car. They can give you a discount of 5-10% if required.

Check the offer properly

Some offer may seem very attractive but it might have some hidden clause in it. As we all are very familiar with these kinds of offers like “Zero Interest” or “Zero Down Payment”. But it can give you trouble in future.

With these kinds of offer the buyer might have a chance to save some money but later on the buyers will be forced or asked to pay a higher rate of interest or extra amount of money. Now we need know why this usually happens.

The reason behind this is the dealer is supposed to pay the amount on behalf of you. But they don’t pay it actually, so it sums up to your account and you will have to pay the higher amount of money in order to bridge the gap.

car loan in UK

Financing Option

While financing your car you should always look for the various financing option available in the market. Some car dealers will promote some unbelievable plans to you when you are going to them to buy a car.

But when people apply for the same, people with an average or good credit will get eligible for that. The people who do not have the desired credit rating, they have to look for options and then they might get eligible for some plans where they will have to pay a higher amount for a larger period of time.

So, the bottom line is to check with your bank before you go to the dealers for buying a car.

Hidden Charges

The most common problem that you face while purchasing car is “hidden charges”. The things like rust protection and tinted windows may charge you a high amount of money on your final bill. These extra charges which you don’t even need might come to you as a shocking thing.

If you are 100% sure that you don’t need these kinds of extra facilities or services then you need to cross check that these are not added in your invoice. Now the car dealers always have this tendency to create hype about these things as the most important thing.

So, you are the one who should decide that what you really need in your vehicle and what you don’t need at all.

Warranty Period

Now this is also one important thing in which dealers will always have a tendency to poke their nose. They always try to promote the extended warranty thing. They do all this stuff to fulfill their target of up selling or cross selling of a particular product.

So, you should take the upper hand to decide whether you need the extended warranty or not. In the present market scenario all the vehicles come with good warranty offer. So, before taking it decides whether you really need it or not.

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