Australian Car Loans

Online Car Finance Loans

A lot of emotion is involved with the purchase of a driver’s first car.  It is often a right of passage and finding the right car can be an exciting time for young drivers.  The make, model and colour are all important.  Then you have to work out how you’re going to pay for the car. Some young drivers choose to use savings to pay for their first car. Another option is to save a deposit and apply for  car finance .  Knowing which financier to approach can seem daunting unsure of how to get car loans.

While Australia’s economy wasn’t hit as hard by the global financial crisis as other countries, it still played an enormous impact on the car finance industry.  New compliance laws were introduced and lenders became a lot stricter in an effort to avoid reckless lending and to reduce defaults.  New regulations may effect younger drivers looking to get car finance.

For young drivers with little or no credit history, organizing car finance can seem like a daunting process.  There may be pressure from the seller of the vehicle, whether it’s a private sale or a car yard.  Choosing a financier may feel as difficult as choosing the car itself.  Some car loans promise low interest rates but have high hidden fees.  Other car loans promise guaranteed finance but with high interest rates.  It’s important to find out the term of the loan, the interest rate and any upfront or penalty fees.  Generally, the interest rates for new car loans will be lower than those for used cars, with the payment term for a new car being longer than for a used car.

A good car finance broker with access to many lenders can help you decide which loan is most suited to a young driver’s financial position.  Car loan brokers have a large number of banks, lenders and other loan brokers at their disposal and once the broker has provided these with your details they can choose the best car loan offers to pass on to you.  This way you can avoid any unscrupulous lenders and find the most suitable car financing.

Generally a car loans lender looks at a borrower’s credit history, their ability to repay the loan and the age of the vehicle. It’s important to have the right documentation to verify the information you provide.  To get car finance,  you may have to provide bank statements, pay slips, insurance details, identification such as a drivers license and references.

For a first time borrower one option to get car finance is for a relative with a good credit history to act as a guarantor on the loan.  A guarantor underwrites the loan and agrees to repay the loan if the borrower can’t meet the payments. It’s not required but it may improve your chances to get car finance from the car financing company.  Having a large deposit may also may also make the lender more likely to approve your loan.  Also the lender may require that the car itself be used as security against non-payment.

An experienced broker can make getting car finance faster and easier for you.