Understanding Car Finance

Car loan ads flood our screens with offers of ‘low interest loans’ ‘no deposit finance’ and many other enticing claims. Buying a car can be exciting but the fun can seriously fade when it comes to finding a car loan. Many people spend their time applying to multiple finance companies for a quote on their car loan, not realising that multiple loan applications may have a negative impact on their credit profile.

An easier approach is to use a car finance broker. A car finance broker works in a similar way as a home mortgage broker operates to find you a mortgage on your home. A car finance broker finds you a loan for your car. Brokers are available to both individuals and businesses, regardless of your financial situation.

Using A Finance Broker

You don’t need a referral, you can contact a car finance broker directly. Ensure the broker you select is independent and not an agent for a particular bank or finance company. This independence ensures that they will be working to find you the best car loan from their wide panel of banks and lenders.

Professional car finance brokers are accredited with a large number of banks and lenders so they have more choices to get you a cheaper car loan. They will handle the finance deal to save you time and a lot of hassle and aggravation!

Car finance brokers handle both personal car loans and business vehicle finance. A broker will explain the details of your loan, especially terms like ‘no deposit finance’. This usually refers to no deposit being requested by the lender which is different from any deposit which may be requested by the seller.

To find a broker who can assist you, please contact us as we know people who specialise in car finance.

Car Finance Options

Personal Car Loans

If purchasing a car for personal use, the most common form of loan is a Secured Car Loan. The lender uses the car as security against the money you are borrowing. You reay the loan over a set amount of time at a set monthly repayment.

Business Car Finance

If a car is being purchases primarily for business purposes, the choice of commercial finance types include:

  • Chattel Mortgage
  • Commercial Hire Purchase
  • Car Leasing
  • Leasing with Salary Sacrificing
  • Car Rental

Deciding which finance facility best suits your business structure should be made in discussion with your accountant. It depends on your accounting method, treatment of tax deductions and GST, balance sheet approach and other issues.

To take the hassle out of finding a great car loan, please contact us – we know people that specialise in sourcing the best car finance deals.