So, you have made the decision to buy a car on finance. Wait! How do you know the right car loan to choose from? Let New Car Canada – New and Used Automobile Financing Site guides you during you conduct the research. In most cases, car loan might be with you for a number of years, but it doesn’t mean that you know the right one. Newbie to the car loan world? Okay, you can continue to read this article.
As mentioned more and more, the types of loans are what you should consider as well as other consideration factors. There are a few options when looking at car loans. Nothing compromise to understand the difference between them all to ensure that you find the best one.
1. Secured car loan
When choosing this type of loan, the lender will ask you to use the newly-purchased car as the guarantee that you will afford the loan repayment When opting this kind of loan, you will get flexible repayment options and the low rates. Somehow, it is so important to ensure that you choose the right loan amount and are able to repay the loan, or you will lose your newly-purchase car.
2. Unsecured car loan
Similar to the secured car loan, this is also used to finance a car or any other purchase. Fortunately, you should not back up the loan since it doesn’t require the guarantee. Sadly, it comes with higher interest rate because the bank or money lender takes on a great risk. Additionally, you can use this type of car loan to finance a used car purchase.
3. Dealer finance
Not familiar with this term? In simple words, it is offered by a car dealership. In fact, you will get higher interest rate than the loans with bank or third party lenders. The reason behind why people choose this option is the lower ongoing repayments.
4. Chattel mortgage
As another option, you will like to consider this type of the loan. Simply put, the chattel mortgage is a business loan, which allows the borrowers to buy a car. The lenders typically give you the loan amount and then taking out a mortgage over the car. Are you a self-employed person or the company owner? If this is right, congratulation, you can opt chattel mortgage when other types of loan don’t look so tempting. Come to the nearby loan lenders for further info and ask some questions.