What types of credit are there for car loans?
1. Installment loan – very flexible
The normal installment loan can of course also serve as a car loan. Here you have to z. B. do not deposit the vehicle registration document since a normal installment loan is not earmarked. So you can handle the vehicle registration very flexibly, e.g. B. if you want to sell the car again later. An important advantage that the installment loan offers. Installment loans are somewhat more tied to creditworthiness than pure auto loans.
2. Car loan/car financing – a little more scope for creditworthiness
The car loan or vehicle financing is specifically geared towards vehicle lending. Here you usually have to deposit the vehicle letter, but you can have a small negative feature in the lenders. For example, one thing that says it is done. Since car loans or vehicle finance are secured with the vehicle letter, there is a little more leeway in terms of creditworthiness.
3. Balloon financing – lower monthly rates
Balloon financing is a type of loan for car loans that offers very low monthly installments. This is due to the fact that at the end of the term of a balloon financing, a fixed residual value remains from the financing. at the end of the term, the residual value can then be repaid through the sales proceeds, or the vehicle can be returned. Monthly balloon financing rates can be up to 40% cheaper than other types of loans.
4. Manufacturer – dealer financing
The financing offered by car dealers usually sounds very cheap, especially in the area of interest, cheap offers are made. But if you compare several types of credit with one another, you will find that many financing offers from car dealers entice you with low-interest rates, but then the higher costs are in the vehicle price, and you ultimately pay more than with a classic credit type from a credit institute.
What are the requirements for an auto loan?
To grant a car loan you need an attachable income or a guarantor with an attachable income. Individuals are then required to have a net wage or salary of $ 1,200 or more. For a married person without a child, approx. $ 1,700 net.