If you do not buy your car in cash, you should carefully weigh the pros and cons of financing and leasing. An external installment loan, eg from the buyer’s house bank, will be accepted for financing. In scenario C, the car is paid directly without a loan, whereby the buyer can often negotiate a high discount deduction. For special repayments we do not charge any fees. Almost every second one of them is being financed – at least every second new car and every third used car. Further illustration at http://hcingenieria.com
Financing the new car – which one is the right one?
Financing the new car – which one is the right one?” />
Car Finance: Which is the right one for you? If you want to buy a car, you usually have to spend more money. That’s why many consumers are considering buying their new cars. However, it should be noted that these conditions often only apply to certain types. Often, the favorable interest rates are also linked to a short-term fixed interest, which then leads to high monthly payments.
In addition to the cash payment, there are essentially three financing options: financing is provided by the manufacturer’s bank or a free vehicle bank, a loan from the principal bank or via leasing transactions. Purchase or rent? Basically, you should decide first whether you prefer to buy the car or only rent. When renting you conclude a rental agreement for a certain time and then at the end of the rental period forced to return the car.
Payments are made in monthly installments.
In other words, you only acquire the right to use the car and not the car itself. If you want to purchase the car after the contract expires, this is only with the agreement of the dealer. You as a renter have no purchase entitlement, but of course it is always possible to make an agreement with the seller.
One of the advantages of leasing transactions is that no market price risk occurs. It is responsible only for wear and possible damage. Because monthly payments are deductible only for craftsmen or self-employed as operating expenses, this form of financing is better for entrepreneurs than for private individuals. The main differences between finance and leasing business are that the customer acquires the vehicle and becomes the owner.
However, the collateral ownership of the car remains with the principal bank until full payment of the loan amount. This means, in plain language, that the house bank, as in the leasing business, has the right to send a reminder or to terminate the lease and thus sell the car elsewhere if the renter does not pay.
As a rule, the acquirer has the option of choosing between the three types of financing: regular financing, balloon and three-way financing (also called selection or vario financing). With a regular financing concept, the car is paid in equal monthly installments. The operating time is determined in advance. For the financing of the balloon also equal monthly tranches are paid out. In general, however, these are low, as at the end of the contract period, a higher completion rate is payable, the amount of which is already fixed at the conclusion of the contract.
The last installment will be refinanced with another loan and repaid in small tranches. The return is made to the retailer who cancels the financing at the contractual redemption price. In the case of illness (after a period of 30 days in the event of incapacity to work), this covers the costs incurred until recovery.
In the event of death, all outstanding amounts will be accepted and reimbursed. On request, you can also take out a separate unemployment insurance, which pays the tariffs, if you lose your job without own fault. However, such insurance is only meaningful if the vehicle purchase over a very long period of time or is very narrow.