Unless you’ve been through it before, you may have no idea how to get car finance, which may result in you paying far too much. I’m always available to help you through this process; however, I’ve written this article specifically to help you understand the process a little bit yourself.
Select your car and get a quote
This is the fun bit. Go see a few dealers, find a car you like, and ask them for a written quote on the car and any extras you want. At this point, it’s probably a good idea to ask your dealer for a quote on finance as well, but it’s important to ask the right questions:
- What’s the interest rate?
- What fees are involved, upfront and ongoing?
- What are the monthly repayments?
- What is the loan term? (i.e. duration)
- What is the balloon payment?
Talk to a Mortgage Broker
At this point you can shop around for finance a little. I, of course, always recommend you talk to a Mortgage Broker, but banks do car loans too. Take your car and finance quote to whoever you choose to see if they can beat it, but be sure to ask the questions listed above.
Provide necessary documents
When you have decided on the car and your financier, they will ask you for your personal information and then walk you through what documents you will need to provide. For most people, it will be as simple as: a Driver Licence, 2 recent payslips and the car quote.
Once your application has been sent off, you will usually have a response within 24 – 48 hours.
Sign loan agreement and await funding
Loan documents will be issued to your Mortgage Broker or financier with all the terms, conditions and repayments outlined. Check these carefully and sign them when you feel comfortable. Your dealer will also need to provide an invoice for the full amount at this point, so the bank may pay them promptly. Whilst this process is usually very quick, some dealers can be less co-operative than others; however, it is a legal requirement that they provide the invoice within seven days of the request.
Pick up your new car!