Bangalore: It is everyone’s desire to have a brand new car of their own, but when the issue of payment comes, it is a real challenge. Nowadays, most people finance their vehicles. Organizing loans for your vehicles won’t turn out to be a complicated task if you have a thorough knowledge about the various options available. Here are few of the best options for auto loan financing-
Home Equity Loans
If you own a house, you can use home equity loan as auto loan options to buy a vehicle. One can obtain this loan at a credit union or bank. It is tax deductable since it is the second mortgage on your vehicle. But, be sure that your mortgage payments are up to date. Compared to a special finance auto loan the interest rate is very low. But be careful to make your payments correctly, otherwise you may even lose your home.
Bank Loan
It is the most common source for financing car loans. If you have a customer relationship with a bank, then it is the best auto finance option as it will offer loans at a much less interest than any other lender. But, better check with different banks to find out the best interest rates. Certain factors like credit rating, the vehicle’s age and mileage and your employment stability will matter while applying for loan.
Finance companies and credit unions
Finance companies buy a loan wholesale, mark it up and sell it retail. Getting loan through finance companies is comparatively easier, but the interest rates will be higher. To obtain loan from a credit union you must be its member. They offer the best loan rates with simple interest. Credit union members generally pay reduced fees associated with a loan application or loan documentation. Since credit unions are smaller in nature, they can offer personalized service.
Dealers
Auto dealers offers numerous auto loan options for people with sub-prime credit that have special circumstances preventing them from receiving an online direct lender approval. The larger the interest they charge you, the larger is the commission given to the dealership. Some loan companies have a limit on this interest rates, but some do not.
