But also the purchase prices for used cars often exceed the available capital of the car buyer. In this case, many banks offer special car loans. Compare now the current loan rates for your car and take the cheapest loan for your car conveniently online! More than half of the buyers would use car loans as a form of financing due to the low interest rates – and the trend is rising. However, interest rates hardly fall below three percent, as a glance at the reference calculator on the internet shows.
Buying a car is expensive, especially if it’s a new car. But also the purchase prices for used vehicles are often above the available capital of the buyer. In this case, many banks offer special loans. This car loan is intended exclusively for the purchase of the desired car, motorcycle or caravan.
As a result, auto loans are generally cheaper than installment loans without purpose. This and the currently low interest rates mean that loans for cars are particularly cheap today. The average interest on a car loan was 3.18% in 2016 and 4.14% in 2014. Our credit rating comparison shows how high the interest rates on car loans are with the relevant providers: The ScotBank’s “Auto and Credit Navigation Study 2016” shows that more than 40 percent of car purchases are regulated through financing.
In view of the high purchase price and the currently low interest rates, the purchase of the dream car makes sense. It raises the questions of where to find the right loan. The German car buyers finance 37% of their motor vehicle through the house bank and 35% through the car dealership. Finally, 17% are still borrowing money from private lenders, 7% are leasing their vehicle and only 4% are completing a three-way financing (Source: “Car and Credit Navigation Studies 2016 of the ScotBank).
Even if “zero percentages” sound seductive, borrowers should know that the banks offered have nothing to reveal. In addition, borrowers with fixed borrowing and some negotiation skills can reduce the purchase price of the vehicle by up to 20 percentage points. If car buyers buy their dream car in cash, they can still negotiate the selling price with the dealer.
If cash is difficult to squeeze when purchasing a car from private USUsus and the purchase price then dealers often give a discount. The first requirement is to take out a car loan and use the available money to negotiate with the dealer. Of course, the car loan should be adapted to their own financing options, so as not to have the following financing option.
Borrowers should therefore ask for tenders at several credit institutions in order to filter out the cheapest. For interested parties our car loan comparison is available. German car buyers, according to “Auto and Credit Navigation Studio 2016 the Scottish Central Bank” have a clear message. For 52% of them a cheap price offer comes first when buying a car. Second
In second place is a good interest with some distance (37 percent). An uncomplicated loan agreement is required by 27% of the borrowers, 18% rely on variable loan financing. With a car loan which cars can be co-financed? Car loans are purposeful, which means that borrowers have to prove that they are actually using the loan to finance their vehicles.
In the case of a car loan, the house bank often uses the title of the vehicle as a security. Therefore, borrowers must provide accurate information about the vehicle to be financed. Because the car loan must be secured with at least 80 per cent of the vehicle value, so that the house bank can grant the car loan. Therefore, the vehicle must not be older than one year.
With increasing age, the vehicle loses importance, the security of the loan would no longer exist. Nonetheless, vehicle buyers can also co-finance used vehicles from many manufacturers. The already fixed financing option offers many advantages. In this way, the borrower can use the loan amount for a cash purchase at the dealership and significantly reduce the purchase price through skillful negotiations.
The car loans are, as the title suggests, mainly used to finance vehicles. However, because each individual house bank itself determines what to finance with its own car loan, the borrowers should ask in advance the staff of the house bank, if their borrowing needs can be met.
The most commonly funded car in the Federal Republic. Accordingly, 33% of all installment loans were used for second-hand financing. In second place is the new car financing with 26% – nearly 60% of all installment loans in the Federal Republic were used in 2016 for the purchase of a car.
This is an increase of 12 percentage points over the previous year, when “only” 25 percent of the loans were used for the purchase of used cars and 22 percent for the new car financing. Incidentally, the average amount of credit in Germany is highest in Upper Bavaria: car buyers receive here 14,207 USD to cover their mobile vehicle.
The currently low interest rate guarantees that auto loans with an average interest rate of 3.18% in 2016 (2014: 4.14%) are cheaper than ever before. Even in 2011, car buyers had to pay for a car loan on average almost 1,500 USD interest – now it is almost 800 USD.
The interest savings are higher than the price increase for new vehicles, so that German vehicle buyers today can afford more cars than just a few years ago. But be careful, the interest rates can hardly fall, the room for maneuver of credit institutions is limited in view of declining earnings. So the purchase of the dream car should take advantage of the moment!