If
you decide to buy vehicle than you have to make a decision whether you
will buy it for cash or go for loan. This question leaves you a little confused.
You don't have to think much about buying a car on loan basis as you will get
loan arranged through our preferred institution based on the price of the car
and related expenses (sales tax, registration and licensing fees). Most of
the automobiles manufacturers have their own companies to finance automobiles.
We
have many schemes for automobile finance from three to five years -- 36
to 60 monthly payment. You have to decide as longer you take to pay off the loan,
the lower the payment would be as longer the period and monthly payment will depend
on the interest rate, and the amount which have been paid as down payment. You
own the car after full settlement of payment.
If
you are buying a car by doing a cash payment then it makes the transaction very
simple.
The
cash payment helps you to remove several variables from the negotiation process
:
- the
interest rate,
- the
down payment
- and
the monthly payment.
Apart
from these options for automobile finance , the car buyer need to keep
other points in mind are:
- If
the buyer's repayment capacity is not higher than three-years loan term may be
too short for him.
- In
the current falling interest rate scenario a seven-year term may be too long.
In some cases, the five-year term loan will be ideal.
- Some
financiers hide charges such as documentation charges, processing fees, etc. Just
look out for the hidden charges.
- Bank
teller provides you the EMI's for financed car according to your repayment capacity
so interest rates and EMIs payable are always negotiable.
- Be
alert as most the financers try to squeeze more margin from customer in the form
of lower interest rates and EMIs towards the end of the month to meet their monthly
target.
