Finding the right car loan is important if you want to get the best deal on your motor vehicle purchase. Even if you find a great price on a car or truck, you also need to find a lender who offers the lowest rates. The first step every buyer should take is to learn about the five types of car loans and how they are different from one another.
Buying a Car with Personal Loans
Personal loans are commonly used to finance a number of personal projects and expenses. The list usually includes home renovations, holiday travel, debt consolidation, and medical procedures. They can be used in place of car loans, but this is not usually recommended. That’s because it is not your cheapest option when buying a vehicle. If you plan to use personal financing, make sure you pay attention to interest rates to prevent overspending in the long term.
Financing with Traditional Car Loans
Car loans are the more common way to finance a vehicle purchase. They are similar to the personal version but usually offer lower interest rates because the lender will use the vehicle as security against the amount borrowed. Fees and interest will vary from one lender to the next, which is why you should consider working with Blink Finance to get the best deal on financing.
Car Buying with Chattel Mortgage Loans
The Chattel Mortgage is a type of loan that was created for the purchase of business-use vehicles. In this situation, the company owns the vehicle and the lender will use the vehicle as security. This option usually offers the lowest interest rates compared to other types of business loans. The contract usually lasts 12 to 60 months and the vehicle may be eligible for tax deductions when used for business.
Applying for a Commercial Hire Purchase
A commercial hire purchase works a little different from other car loans. In this situation, the lender will buy the vehicle then hire it to the client for an agreed-upon length of time. The client has full access and use of the vehicle during that period, but doesn’t actually own it. After the final payment is made, vehicle ownership is transferred to the client.
Agreeing to a Novated Lease
A novated lease is a three-way system that works between a leasing company, employer, and the employee. The employee leases the vehicle from the leasing company, and the employer takes on responsibility. The employer makes the lease payments for the employee, deducting the amount from the worker’s pre-tax income. This type of financing can be approved as a vehicle-only lease, a fully maintained lease that includes running costs, or a fully maintained operation lease that factors in running costs and residual value risk.
Choosing the Best Car Loans
The most effective way to choose the best car loans is with the help of someone who knows the vehicle market and financing industry. Blink Finance is your full-service personal loan solution. Contact us at 1300 827 848 or visit our website to complete an online application.