Nowadays, there is no significant difference between financing options for a used car and a new car, financing for a used car is relatively easy and you can get pretty good deals.
As a general rule, it is worthwhile to finance only a reputable financing company, otherwise financing can be very expensive and the risk higher. Own power is usually min. Starts at 20% and max. Up to 80%, depending on the age of the car and the form of financing. Nowadays, identity documents and proof of income are usually sufficient for car financing. The maturity usually varies from 12 to 84 months. The oldest funded car is 12-14 years old, but car financing needs to run at the car’s max. Up to 15 years. In terms of interest rates, the difference between the offers of the big car financing companies is 2-5%, and the offers of the smaller car companies can be even more expensive. Nowadays it is widespread that besides forint-based car financing, foreign exchange-based financing is also available, which is definitely more favorable in terms of monthly fees when starting. However, this advantage can be reversed, or at least worsened, by unfavorable currency / forint exchange rates over a longer term. Therefore, with a maturity of more than 24-36 months, forint-based car financing is definitely more predictable and therefore much less risky.
It is advisable to request a prior credit assessment
It is made before entering into a vehicle purchase agreement so that you will not be forced into it later. In the case of a contract of sale, we are obliged to buy the car even if the financier does not give credit for the purchase or does not give it on such terms.
If we know how long we will need the car for, then it is not worth choosing a much longer term than necessary, as terminating a contract before the end of the term can be a serious financial loss. The reason is that most of the interest is paid in the first half of the term, so in the case of an early termination we cannot get away with it or get it back.
If you want to finance a car as a company, make sure to talk to a finance specialist and your accountant first so you can save a lot of inconvenience and unnecessary costs for your company.
Dealerships and major used car dealers
We have a choice of offers from more financiers, especially those from the larger dealers.
So, after choosing a car, it is worthwhile to visit the dealer’s financing offer in person with one or two car financiers for a direct quote. In numbers, we will almost certainly get better, but it will almost certainly be much more complicated to manage a car loan because the dealer has a well established relationship with his own financier. In a simpler case, it takes a few hours, and a few days more complicated, to sign and approve a financing agreement.
Smaller used car dealerships may not always find the deals of the big car financiers, but they are also available for financing, though as mentioned above, they are more expensive and may involve greater risk. It is often the case that the offer from these financiers is misleading, so in each case, we review the terms and conditions, calculate, and compare them with other offers.
There is no interest-free car finance construction
No used car loan, it’s just a hoax. Interest shall always be payable, unless otherwise specified. If they are advertised, they either turn out to be interest-free or, if they do, they are already included in the purchase price of the car. If we are not on the lookout, it may very well be that an offer that looks cheap will end up being really expensive. The same is true when they promise that casco insurance is not a prerequisite for financing, as the risk must always be borne by someone. In such cases, the car financing company usually puts a casco on the car and pays a fee for it. However, from the customer’s point of view, this is not as unfavorable as the financing company can provide much better insurance for the used car than the customer himself. It is also important to know that the casco insurance provided by the financier does not cover all the damages, and the client must always sign a statement acknowledging that the amount of the damage is recoverable.