Lot of Aussies prefer to buy their favorite cars on finance due to various reasons. The biggest one being the convenience of not having to put their own money in one blow. They can arrange car finance on favorable terms, which will allow them to pay for their car in an easy way in manageable monthly installments.
Car finance is not only beneficial for buyers, but for car makers and finance companies as well. They will earn more profits as more people buy cars using car finance. They actually act as a sort of bridge between car manufacturers and buyers.
There are various methods for car finance available to you in Australia.
Here we are discussing few of them for your benefit, so that you have some idea on the best available option for you:
1. Car leasing -In this method of car finance, the finance company and the customer arrive at an agreement for the usage of car. The car will be purchased by the finance company and its title will remain in his or her name. The customer uses the car for a set time-period by paying a monthly lease.
2. Hire purchase agreement-In this car finance method, customer pays all necessary fees, charges and monthly installments. The title of the vehicle will be transferred in the name of the customer only when all the installments are cleared within a set time period. The ownership of the vehicle remains with the car finance company.
3. Chattel mortgage-In this car finance method, customer has to provide collateral in the shape of immovable property to avail a loan for a car. With collateral, the finance company has an assurance that you will repay the loan amount on regular basis every month. Once all the installments are clear, collateral is then returned back to you.
4. Personal loans-Many Australian also use personal loans for buying their dream car. Personal loans are available at a slightly higher rate of interest than usual car loan, but there are less of hassles in getting them. The usual approval by the lender hardly takes no more than 48 hours.
Personal loans are available as:
• Secured personal loans-In these types of loans, lender usually insists on some collateral from the borrower before approving their car loan application. The benefit of these types of loans is that they come at a lower rate of interest and have a longer repayment period.
• Unsecured personal loans-These loans are issued without any collateral but they carry a much higher rate of interest than secured personal loans. This is mainly due to the risk to the borrower in the absence of any collateral. They have a shorter repayment period.
With the above mentioned car finance solutions, you have a wide choice and you can choose the best possible option for your needs.