Are you thinking about financing your new car purchase? Found the car that you want to buy, but don’t know where to start with arranging finance?
Choosing how to finance your car isn’t easy.
Why? Because you’re bombarded with numerous options, confusing claims and simply bad advice. From 0% loans and high-pressure sales – to unsuitable loans and near-worthless advice – how do you ever find someone who is qualified, competent and professional to provide you with unbiased advice and quality service?
Follow these four steps to have stress free financing of your new car:
STEP #1: Make a commitment to yourself to get quality advice around your car financing. Find a broker, bank lender or dealership finance manager who will invest the time to ensure that they understand your financial situation, needs and requirements. This way you will ensure that you have all the relevant information to make an informed decision.
STEP #2: List your objectives. What do you want to achieve with your car financing?
- Do you want a car loan, with a low headline interest rate and not too many questions?
- Do you want a car loan which meets your needs, that is suitable for you and that will not cause you hardship?
- Do you want to work with a fair, ethical and professional Finance Broker?
- Are you willing to risk working with a car dealership that offers 0% dealer finance – knowing that you are most likely paying an inflated price for your car?
STEP #3: Ask questions. The best way you learn about the finance business you are working with is to ask specific questions and listen carefully to the answers. Here are ten tough questions to ask your financer before he begins developing the advice for you:
- How much does the service cost and when do I have to pay?
- Do you belong to an industry association such as the Mortgage and Finance Association of Australia (MFAA)?
- How do you identify the best solution?
- How many lenders (and which lenders) do you represent?
- How do you get paid?
- Can you provide comparisons of any loans recommended, including upfront and ongoing fees?
- Can you clarify the actual cost of the loan, including and excluding interest, fees and ongoing costs?
- Do you comply with the Privacy Act?
- Do you have professional indemnity insurance?
- How long have you been in the industry and can I read your testimonials from previous clients?
STEP #4: Once you’re satisfied that you’re working with a fair, ethical and professional finance professional, engage them to provide you with a written recommendation for your car financing. A written recommendation gives you the assurance that you know exactly what your car finance will cost – no surprises.
By following these four steps, you’ll gain all the information you need to make an informed, intelligent decision. If all you want is car loan, with a low headline interest rate and not too many questions, any finance manager at the car dealership can help you. Or you can walk into your local bank and get sold their car loan product.
But if you want good advice – if you’re looking for someone who will invest the time to understand your financial situation, needs and requirements – to find a great deal on your car finance, then follow the 4 steps outlined above.
If you are interested in learning how to avoid four car financing rip-offs, six common car financing misconceptions, and 8 costly mistakes with car financing the get a copy of my Consumers Guide to Car Financing.
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