A car loan is a personal or business use loan for the purchase a motor vehicle. The motor financier will in most cases use the car as security, which will often get you access to discounted interest rates.
What Does It Mean To Use The Car As Security?
If your car is being used as security, then this would mean that the financier may have legal right to repossess your vehicle if you are in default of your car loan.
As the loan type would be a lower risk, as opposed to an unsecured loan, this would often result in lower interest rates, which is one of the driving factors why people would request a secured car loan.
Who Can Get A Car Loan?
You would need to be over the age of 18 years and have a valid NZ driver’s licence.
You would also need to be earning enough income to repay the car loan repayments, as per the motor financier’s affordability calculations, so you would also need to be employed in most cases?
If you are a registered business, you may wish to take out a business car loan in your business name.
Can I Buy Any Car With A Car Loan?
You will have the freedom and flexibility to buy any car you wish, where you want to purchase it from.
You may wish to buy from any dealership in New Zealand, or an auction, or you may have found your dream car being sold by a private seller.
The main restrictions on car loans would be the age of the vehicle, and if it is too old, the motor financier may not allow it to be used as security. If you are looking for an older vehicle, give CarLoans.co.nz a call to find out whether it is a suitable vehicle or not.
What About If I Have Bad Credit?
If you have bad credit, there are some specialist lenders that can assist with the finance of a car. The mainstream banks and financier may not be the best solution if you have bad credit, so get some professional advice, as these applications are not the same as a normal car loan.