Find out what you need to know now!

If you are thinking about buying another car in the short to medium term, there are some key things you need to know.

With so many lenders and loan options out there, it’s hard to know which option is right for you. Whether it’s dealer finance, a loan from your bank or a broker, the task of finding finance for your new wheels can seem like a daunting task. So, let’s break it down for you.

Dealer Finance

Dealer finance can be a convenient option when buying your car from a car yard. However, it’s difficult to know if you are really getting the best deal on the market. Whilst interest rates can be considerably lower from a dealership they are often only available on certain makes and models. More than that, salespeople are often paid a commission on the finance part of the deal, as well as the car itself, which can push interest rates upwards and put buyers under pressure to sign on the dotted line.

Most dealers only offer finance from a single financier, who they are aligned with. This can mean you are unlikely to get the best deal out there, so you need to check if dealer finance is the right option for you.

The takeaways: Whilst advertised interest rates from dealers can look appealing, dealers generally do not have a broad range of options for you to choose from which means you might end up with a loan that doesn’t work for you long term.

Car Loans

With a car loan, you have a lot more flexibility in the product you can choose, particularly if you source it through a broker. Interest rates will tend to be very competitive with flexible terms and repayments. This allows you to choose the car you want; over the loan term you want with repayments that suit your budget.

Where brokers can be particularly useful is negotiating a loan on your behalf with numerous lenders. This can save you a lot of time and money. They can also help find finance for those who may be credit impaired or self-employed.

Brokers like Loana make the whole process of getting on the road with your new car as easy as possible.

The takeaways: Car loans are generally far more flexible than dealer finance, meaning you can choose the terms and repayments that are right for you. If you use a broker, you will have access to a large range of loan products including loans for self-employed or credit impaired.

Novated Lease

For some people, a novated lease can be a great way to get the car you want. You can obtain a vehicle plus all of its running costs and have it packaged through your employer as a salary sacrifice.

Your novated lease can include fuel, insurance, rego, servicing and tyres as well as roadside assistance. Plus, you have the added flexibility to match your budget with repayments. Whilst a novated lease may not suit everyone, it’s definitely worth looking into as an option as there are definitely savings to be found.

The takeaways: Novated leases can provide a great deal of flexibility for some individuals as well as the convenience of having all your car’s running costs rolled into one payment. However, not all employers will allow you to salary sacrifice a vehicle and it’s worth checking with them, or your broker first.

Car Loans and Finance

Australian Associated Advisers Pty Ltd trading as KeyInvest Lending Services, KeyInvest Insurance and KeyInvest Car Finance, Australian Credit License Number 392169 ACN 084 974 694. Australian Associated Advisers Pty Ltd is not authorised to carry on business in any country other than Australia. The information contained in this website is directed to and available for Australian residents only. Copyright © 2016 unless otherwise noted.

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