Finance

Stuff to bear in mind when a car loan is taken out

Are you considering buying a car?

Below are a number of points that are good to keep in mind when taking out a Florida title loan .

Requirements for full insurance

Many players require that the car is fully insured during the term of the loan. Some players offer both loans and insurance and then you may be able to negotiate better terms.

Other vehicles

Most players also offer loans for motorcycles, caravans, motorhomes and scooters. In some cases, however, there are other conditions on the loan.

Authorized dealer

Several players require that the car be purchased from an authorized dealer. If you are going to buy a car from a private individual, some companies offer special car loans, with others you have to take out a regular private loan.

When buying from a private person

If you are buying from a private individual, it is worth being extra careful and checking out information about the car. Ask for a receipt that the car has been paid for and check that the person you are buying from actually owns the car.

This information about the car has been inspected and if the tax has been paid, you can get it via the Car Register which can be reached via 0771-14 15 16. There you should also be able to find out if the car is already mortgaged. Feel free to visit the Swedish Consumer Agency for further tips.

Cash deposit at least 20%

According to the Consumer Credit Act, the seller must charge a cash contribution from the buyer. In principle, all players require you to pay a 20% cash deposit, but this can in most cases be in the form of a replacement car.

Fixed or variable interest rate

With many companies, you can choose whether you want a fixed or variable interest rate on your car loan. The variable interest rate is normally linked to STIBOR.

As with mortgages, for example, you must make your assessment of the future interest rate situation and your conditions and decide what suits you best. In Compricer’s price comparison for car loans, only variable interest rates are used.

Green car

Some companies (currently Swedbank and SEB) offer better terms for loans for green cars. If you are considering buying an eco-car, it may be worth investigating this further. Do an advanced search and click for green car here.

Age of the car

Most players also provide loans when buying used cars. However, most people have a limit on how old the car may be at the time of signing the loan and what the loan redemption is.

However, these limits can be fluid and if you are considering taking out a loan on an older car, it may be worth contacting the respective company.

Amortization

In some cases, you can choose whether you want straight amortization or annuity . The amortization rate is often adjusted to the depreciation of your car. This means that you avoid having too much debt when you want to change cars next time.

You can often extra repay or repay the loan whenever you want, free of charge. In Compricer’s price comparison, annuity is used to obtain a fair comparison between the various players.

Residual debt

In many cases, you can choose a residual debt for your loan. After the contract period, you can then extend your loan, repay the loan or change to a new car. The car with residual value can be an advantage if you change cars often, as it gives a lower monthly cost.

If you change cars often, there is rarely a reason to pay for the entire car in a few years. In advanced search, you can enter the residual debt.

The car brands’ own finance companies

Most car brands have their own finance companies that offer financing for car purchases. As these companies only offer financing for the current car brand or with their authorized dealers, they are not included in the comparisons on Compricer. Of course, it may also be worth checking with these in cases where it is applicable to you.

Right to deduct

30% of debt interest up to SEK 100,000 is deductible. It may also be worth taking a supplement to the loan in the form of a voluntary insurance called loan protection.

It will help you repay your loan should you suffer from involuntary unemployment or be on long-term sick leave. In the event of death, the entire remaining debt is often settled. Most of the players have some form of loan protection where you often pay a fixed percentage of the monthly cost.