The car is still considered the preferred purchase of Germans – and most of them also have a car that is very special in their sight. With prices skyrocketing for years, not many can afford to buy the car of their dreams with their own savings. According to the Federal Statistics Office, the proportion of cars financed by credit or lease in 2020 was 46 percent for new cars and about 27 percent for used cars. However, if you want to finance your car with a loan, you must obtain detailed information beforehand. Because it is precisely in the field of car financing that there is a savings potential that is not visible at first sight and for which it is necessary to plan well.
So drivers should get different offers by comparing loans and comparing costs before buying a car financed with a loan. This way, they can recognize and avoid some of the cost traps. Car dealers, for example, often offer what’s called zero percent financing. However, often car dealers can only offer this type of financing, which at first glance seems profitable, if they take into account the interest lost through the high selling price of the car. Drivers can easily calculate the amount of cheap financing in advance using the loan calculator, which many comparison portals on the Internet provide for free.
Optimum credit planning
In this way, future car buyers can plan their financing with their individual ideas in advance and calculate the actual costs. To do this, simply enter the amount required to purchase the car into the calculator, as well as the required effective annual interest rate and term. Interested parties can already know the monthly installments they have to pay and how high the interest expense and therefore the total cost of the loan. You will also receive a detailed payment plan for the entire term of the loan. In addition, the loan calculator displays alternative terms that borrowers can use to save on interest costs.
This is how to find the correct monthly rate
In order to repay a potential car loan without any problems, you must first determine the monthly rate that suits you personally. The so-called family bill helps drivers with this. In this, they simply compare their monthly income with their monthly expenses. You can then use the remaining amount at the end of the month to pay off the loan installment. It is necessary to plan a financial stock. Car financiers need this in order to maintain cash without any issues even in the event of unexpected expenses such as car repair or necessary home renovation.
Maximize all savings potential
Those interested in credit should not only compare different loan offers in order to find the cheapest possible car financing. You should also decide on the right purpose of buying a car. This is the only way for some banks to rate the financed car as collateral, and they often give out loans at a lower interest rate. Additionally, car buyers may consider incorporating a second borrower with a good credit rating, such as a spouse or partner, into the financing. This usually also results in banks offering loans at lower interest rates. Well-thought-out car financing can save drivers a lot of money. In short, you should compare several offers in advance, carefully calculate them and make sure that the planned purchase of the car is identified as the intended purpose.
The article “Financing the New Car: Good Planning Is Everything” was published on 6th April, 2022 in the category Guide by keywords editorial staff Financing the new car: good planning is everything, tips and info, chest.