Is it a Good Idea to Finance a Car?
Whether you’re looking to buy a new car or get that well-deserved upgrade, it can sometimes be a good idea to finance a car depending on your circumstances. At QuickCash, we offer finance for anyone looking to buy a car. We know financing a car is a big decision so here’s everything you need to know about whether it’s a good idea for you.
Here are some answers to questions you might be asking about getting a car on finance.
When might I need to get a car loan?
You might need to get a car loan primarily to sort out your transport situation. For example, if you got a new job that’s far away from where you live, public transport may no longer satisfy your needs.
Maybe you have tools or equipment that you need to transport, and your current vehicle isn’t suitable. In a situation like this, it might be a good idea to finance a car. Whether you’re buying your first car or looking to upgrade, a car loan may be the answer to your problems.
What does it mean to finance a car?
To finance a car it means you’ve taken out a car loan to make the purchase possible. You can borrow money to finance a car from a bank, your car dealership or from us at QuickCash. Financing a car also means that the money you borrow you need to pay it back over time that you agreed upon with the lender.
Is a car loan better than a credit card?
With a credit card, you have a set limit that can be used to make purchases. Credit cards build up debt that you eventually need to pay back. If you don’t pay it back in time, you end up paying interest on the debt even though you can still make more purchases. This can be a risky option if you can’t keep up with your spending habits.
Getting a car loan is a ‘fixed credit’. You get a fixed amount of money that you applied for that you need to pay back in a set amount of time agreed upon. The benefit of a secured car loan with QuickCash is that we can offer competitive interest rates. We also have no additional fees if you want to pay off the loan earlier.
Is it best to get a loan from a dealership or lender?
If you get a loan from the car dealership it may not always be the cheapest option. In this situation, you’re giving the car dealer control of the loan. They will decide interest rates, repayments, fees, and may even add their own margin as well.
If you get a loan from an online lender such as QuickCash you have more of a say in the process. We are happy to discuss interest rates and repayments in order to find a schedule that works best for you. We also keep the same fixed interest rates throughout your loan period.
How do I apply to finance a car?
To apply for a car loan with QuickCash all you need to do is fill out our online application form. It takes around 3 minutes to fill out and we’ll assess your application in 25 minutes. This means you could have the cash on the same day!
You’ll just need to provide details of the car, loan amount, your financial situation, the time period you can pay back the loan in, your address, driver’s licence details, and what assets you can use as security.
What are some tips for getting a car loan?
To make sure you make an informed decision about getting the car loan, here are some things you should keep in mind when purchasing a car with finance.
Decide on a budget
Firstly, note down what your budget is. This can help you stay focused and also helps you decide the type of car you can afford without borrowing more than you need to. If you have a repayment plan in place it will help you make stress-free payments knowing you can afford it in advance. If you pay some money as a down payment it can also lessen the debt. Many people find that this makes a car loan more manageable.
Investigate car history
It’s important to know the history of the car you’re thinking of purchasing. For example:
- Has it ever been stolen?
- How old is it?
- How much distance has it travelled?
- Are there any payments remaining on it?
All of these things could cost you more money than expected down the line, even if you’re getting a good deal. Buying an old car may cost you more time and money for maintenance in the long term. It’s also important to check whether the car has a current Warrant of Fitness (WOF) and registration. The laws around selling vehicles in NZ require vehicles to have both at the time of sale.
It may also help you to do some research around how much the car will cost you to run. Things to take into consideration are:
- How much fuel the car uses.
- Whether it’ll require much maintenance, and how much that may cost.
- The kind of insurance plan you’re going to get.
Finding this out can help you avoid further costs later on that may make the car a burden to own.
Test drive the car
Before you make your decision make sure to take the car on a test drive. It’ll help you get used to the car and decide whether it’s for you. Check out how it drives, whether it’s comfortable and if it suits the purpose you’re looking to buy it for. Try out the stereo, brakes, lights, etc. This is your opportunity to check everything works and meets your standards. Better to know now than when it’s too late.
Some people find that in their situation it’s a good idea to buy a car on finance. This may not be the case for everyone, so it’s important you look at your situation specifically. Read more about how to buy a car with finance.
If you have any questions feel free to call us on 0800 784 252. We’ll work with you to help you get the best car finance deal possible so you can get the perfect car for you.
Disclaimer: This article is intended to provide general information only. It does not take into account your financial needs or personal circumstances. It is not intended to be viewed as investment or financial advice. Should you require financial advice you should always speak to an Authorised Financial Adviser.