What do i have to consider for a car loan?

Those who want to finance a car are usually lured by local dealers with attractive interest rates. But this is not always the best deal. Find out why in our detailed guidebook.

A car loan is usually cheapest on the internet

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A car loan will at some point become a relevant scenario for most germans. Apart from the standard installment loan, no other type of loan is chosen as frequently as the car loan. That’s because several million germans finance a car every year. If you are also thinking about financing, you should know a few things about car loans. With the right knowledge and the necessary tricks of the trade, you will be in a much better position to negotiate and save a lot of money.

Is buying a car from a dealer always the cheapest option??

Before a car loan can become a reality, you should first find a suitable car. If you have already decided on a brand, it often makes the most sense for you to get information at the nearest dealer. If you are not sure about the brand, you can compare the offers of different local dealers. But contrary to popular belief, buying from a local dealer is almost never the cheapest option. This applies to both new and used cars.

Instead, online portals are outstripping traditional dealers in this area as well. If you are looking for a cheap car, it can make sense to visit comparison portals on the Internet. There, supra-regional dealers post offers for the purchase of a vehicle. These offers are often more favorable than from your regional dealer. When dozens or even hundreds of providers compete with each other, this usually results in much more attractive prices. So if you don’t absolutely have to rely on advice from a regional dealer, buying a car on the Internet is a good idea. In this case, you are usually dealing with a normal dealer this is just not at your doorstep.

When buying a used car, you should of course think about where you are buying the car before you finance it. Here, too, you can choose between local dealers (tip: new car dealers often sell used cars, too) or compare them on the internet. Due to the larger and above all supra-regional offer, you will usually find a much better selection on the Internet. If you don’t have a special relationship with a local dealer, you will usually get a better deal financially by buying over the Internet. However, professional advice and processing on site without major detours should not be neglected either.

What distinguishes a car loan from other loans??

In principle, you do not necessarily have to rely on a car loan at all. In principle, you can also finance a car with an installment loan. A look at our loan comparison will quickly show you that attractive offers can also be found for such a loan. However, the car loan still offers itself in some cases. This is mainly due to the fact that banks usually offer better interest rates because of the lower risk compared to a regular loan. This is mainly due to the fact that the bank can use the car as collateral for a car loan. ÄSimilar to real estate financing, you can look forward to interest rate advantages compared to a normal bank loan.

Generally, you have to give a bank collateral for a car loan. If you do not finance your car directly at the car dealer, you usually have to deposit the car title at the bank. This rule is usually valid for the entire term of the vehicle financing. Only when you have completed the financing, you will receive your vehicle registration certificate and thus also the official title deed for your vehicle. You cannot simply sell the vehicle accordingly, for example in phases of financial bottleneck. Rather, if they can no longer pay their installments, they must find a separate solution with their bank.

you may be asking yourself how such financing works at all. Actually, you only receive the vehicle registration certificate once you have bought the car. This in turn is only possible after payment, which only works with a previously paid loan. In order to make debt financing for cars possible at all, most banks offer a so-called transfer of ownership as security. You have to agree to such a transfer of ownership as security when you take out the loan and you will then receive the loan paid out before you buy the car. Once the purchase is completed, you must send the car title to the bank as part of the security transfer process. This then holds the vehicle title until the end of the vehicle financing period.

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