It is best for consumers to apply for a car loan at a bank, not through the car dealer or the manufacturer. This way, new and existing customers retain the opportunity to save a lot of money on car financing. Who actually writes and advises here? About us
Apply for a car loan: Here’s how!
Compare loans and provide information
Use the online calculator for a loan comparison and provide the following information: desired loan amount desired term and purpose – in this case: car purchase (menu item “Auto”). In the following short application process, you will be asked to provide your personal information (name, address, etc.). This information is necessary so that it can be checked, among other things, under what conditions a loan can be a grant.
The online car loan calculator then displays numerous offers that are available to those interested. The auto loans are graded according to the effective interest rate, i.e. the amount of the loan costs. The cheapest car loan is always at the top, the second cheapest in second place, etc.
The advantage of the effective interest rate: The value includes all loan costs, not just repayment, and interest, but also any final installments. This means that financing that consists of different cost factors can also be compared! It makes no difference whether a final installment has to be paid for a car loan and not for another.
Receive offers and select car loan
Next, you will receive suitable car loans by post or email, which you can apply for directly. Since you have already given your basic information in the previous step, you can be sure that you will generally receive the conditions mentioned.
Within a short time, a specialist for car loans from our cooperation partner Good Finance will contact you by phone. Together with you, he will check whether all the necessary information has been provided and whether another car financing maybe even cheaper. If necessary, the expert will also assist you in compiling all the necessary documents.
Borrowers who fear that there may be problems approving their car loan will benefit from the loan expert. Because he knows the market for car loans inside out and can, therefore, tell which provider the prospects for approval are particularly favorable. This not only saves time and nerves but also ensures that there are no unnecessary rejections from a bank.
An official rejection of a specific loan offer can have a negative impact on the credit rating! And this, in turn, means that the chances of making another loan request decrease again – regardless of which bank the request was made to.
Please note: It does not matter which car financing you choose for the remuneration of the loan experts. So you can be sure that the specialist will advise you only in your sense.
Submit documents and register receipt of payment
Together with your loan expert, you have now ensured that:
- You have found the really cheapest offer and
- You have all the documents you need to manage your car loan.
Submit the documents by post or, if necessary, personally in a bank branch, confirm your identity briefly during the identity check and wait for the decision from the bank. If your car loan is approved, you can quickly see the amount received on your account.
Take out a car loan – it’s that easy! ✔ Compare car loans
✔ Receive offers and choose a car financing
✔ Apply for a car loan and register receipt of payment Please note: You will receive a car loan if you have sufficient creditworthiness. If you have any problems with the bank, please contact one of our car finance specialists – if necessary, before you apply. The specialist recommends a bank where your chances of getting the loan are particularly good.
What is special about a car loan?
An important factor in the pricing of banks is the so-called default risk. So the banks are trying to determine how likely the loan will not be repaid. This applies to all types of financing, including car loans, of course.
Basically, the lower the likelihood that the bank will remain at its expense, the lower the costs for the borrower.
The advantage of a car loan is that the car is deposited with the bank as security. In an emergency, the bank can sell the vehicle and use the proceeds to pay outstanding credit costs. This significantly reduces the risk of default for the bank! And the borrower, therefore, gets significantly more favorable conditions with a car loan than with financing where no security has been deposited.
Purpose vs. free use Car loans is called loans with earmarking. This means that the purpose for which the money is spent is determined. With a car loan, this is the car purchase. Financial institutions often only offer financings with earmarkings if the object of finance (here: the car) can be deposited with the bank as security. However, this is not the case for a trip or a craftsman’s bill, for example. If the consumer now wants to pay for a trip or a craftsman’s bill, this usually only works with financing without a specific purpose.
And this is usually more expensive because in an emergency the bank cannot sell the object of the financing to pay open credit costs. In the case of a car loan, the borrower delivers the vehicle documents to the bank. From a legal point of view, the bank is the owner of the vehicle for a car loan. This ensures that the bank can easily sell the vehicle in the event of loan default.
What loan amounts are possible?
Each bank decides for itself from which loan amount financing is offered. At many financial institutions, the minimum loan amount is USD 1,000, but at some, it is already USD 500.
The banks also set the upper limit individually. The highest possible sum is usually around 50,000 dollars. Income decisive for the amount of the loan Note: The maximum loan amount a borrower receives depends heavily on their personal credit rating. And here not only the payment behavior of the past plays an important role, but also the regular monthly income.
For example, if an applicant has a monthly amount of 500 dollars after deducting all fixed costs (rent, telephone bill, etc.), this consumer probably has no problem getting a car loan at a monthly rate of 150 dollars.
If the available amount is again 1,500 dollars, the applicant has a good chance of getting a car loan even at significantly higher monthly rates. Basically, in addition to the amount of disposable income, past payment behavior plays a crucial role. So if an applicant has regularly met their financial obligations (i.e. has always paid their bills on time and in full – Schufa determines this for the banks), there is a good chance that a loan will be approved. However, if there were problems here, the chances are not always favorable, even with a high disposable monthly income.
Please note when applying that additional costs may be added to the purchase price when buying a car. These can be, for example, transfer costs or registration fees. It may be worth considering these costs when calculating the car loan. Within a certain framework, the credit institutions allow the purchase price to be exceeded.