The car loan is a special form of consumer credit. The car loan is, as the name suggests, only intended for the financing of new or used cars and relevant accessories. the main advantage of using a special car loan is that this special-purpose installment loan often has a lower interest rate than non-special-purpose loans. The car loan is thus also an alternative to car leasing.
Taking out a car loan: what documents are required?
Before a bank approves a loan, it first checks your identity and creditworthiness. The documents you need for your loan application may vary from bank to bank. In the normal case, this involves the following documents:
statements of your current account
proof of salary for the last 3 months
Car loan – what to consider?
They have made it and found their dream car. Now you’re faced with the next question – how do I finance my car?? And what do I have to keep in mind?
The good news is interest rate situation is currently important for borrowers extremely positive. As you can see from the graph, the prime rate has reached an all-time low in recent years. For consumers, this means that car loans are now particularly favorable.
Financing your first car
You want to afford a piece of freedom and are about to buy your first car? The decision for the desired car model depends in most cases also on the financial situation. That’s why it makes sense to check what the costs are for buying and owning a car.
What are the costs of owning your first car?
Insurance costs: these depend v.A. Depends on the performance of your vehicle (horsepower) and your driving experience. Therefore, young drivers are recommended to buy a car with a low horsepower rating in order to compensate for the high insurance costs of a high bonus malus level.
Another cost associated with vehicle ownership is the following fuel costs.
If you live in the city, you will probably have to deal with additional parking costs you have to calculate. Find out if parking permits are required at your place of residence. If you want to park your car in a garage or on a rented parking lot, you will have to pay additional monthly costs.
Last but not least, you should also take into account the annual service and repair costs think.
New car financing
If you are looking for a suitable financing for your new car, then you will probably ask yourself the following question:
Loan financing or leasing?
An important difference between these financing options, which is particularly important when purchasing a new car, is the question of insurance. In the case of leasing, it is usually assumed by the lessor that a fully comprehensive insurance policy is taken out. When financing with a car loan, it is up to you whether you also want to take out fully comprehensive insurance. The current low interest rates are also an argument in favor of financing with a car loan. Learn more about the differences between leasing and car loans.