To buy a new car, the cash payment is not obligatory, unless you have sufficient funds. If you do it right, taking out a car credit is an interesting alternative to acquiring a new or used vehicle. How to take out a loan for a car is not a problem nowadays. Different financing solutions exist, with significant savings to the key, as the average annual rate can vary from 4% to 10%. Here are our tips for multiplying your chances of finding the car credit that best meets your needs.
How to Take out a Loan for a Car?
An auto credit is an affected loan. The money that will be lent to you must be used exclusively for the purchase of a vehicle. If you already have a car in mind and want to skip the step, here are the steps necessary to obtain your credit.
Make online simulations for your car loan
Feel free to check out the different online simulation sites. Most banks offer their own dedicated tools but you can also find out about comparators that will then list the best deals. This will allow you to quickly realize your borrowing capacity based on the proposed monthly payments but also to get an idea of the current interest rates. They very regularly and you will find it useful to know the lowest thresholds in order to negotiate your loan.
Define a concrete purchase project
Once you have done several simulations, you will be able to realize your possibilities since you will have a more precise idea of your budget. This will allow you to orient yourself either to a new vehicle or to a used vehicle and to adapt the range accordingly. Do not hesitate to have all the documentation available from the seller and information about the vehicle, if it is used, such as its age, the mileage, the overall condition, any repairs to be foreseen. Take the lead by asking for a quote, if you opt for a new vehicle.
Contact Credit Institutions or Banks
You will then have to go to meet the different institutions, with your project in hand and a good idea of the budget that you want to dedicate to the latter as well as the rates that you are entitled to expect. Do not hesitate to get the documents mentioned above from the first appointment. The counselor will then do a simulation that will allow him or her not to give you his agreement in principle. If you get it, you will be able to get the loan application out and wait to receive an offer. If you have the opportunity to inject a contribution, do not hesitate to do so. On sums greater than 10 000 euros, this will help you to lower the final cost of the credit.
Compare the Different Offers
We advise you to take these steps with several institutions so that you can compare the offers. In addition, do not hesitate to let each contacted body know that you intend to play the competition. Once the offers are in hand, which will have been sent to you by mail, it will be important to compare the interest rate, the monthly payments, the overall cost of the credit which can vary greatly with the file fees and the insurance guarantees. Pay special attention to the deferral clauses and penalties in case of late payment.
Prepare your car credit file
Your file must contain a seller’s invoice for a new vehicle or a letter for a used vehicle in which your name and the price of the vehicle will be mentioned. You will also need to add the classic pieces to be provided for any loan application: A piece of identification, a proof of domicile of fewer than three months, a RIB, your last tax notice, your last three salary slips, your And your last five account statements in order to detect possible anomalies.
Canceling a car credit
Remember that you have a 14-day withdrawal period after signing the loan offer. In the case of a car credit, it is expected that the latter will be canceled if the sale fails. In which case you will return the sum to the bank, without interest collected by the latter.
What are the documents to be provided to purchase a car credit?
Depending on the lending agency, the list of parts is providing for the subscription of a car loan may vary, but a few are essential:
Copy of a recent proof of domicile (telephone bill or electricity, gas…),
Bank Identity Statement,
Copy of the latest payroll records, and possibly copy the evidence from other sources of income,
Copy of your identification (identity card or passport),
Quote or purchase order justifying the use of the funds,
Bank Identity Statement,
Canceled Cheque (original).