If you want to finance a car, local dealers usually lure you with attractive interest rates. But that’s not always the best deal. Why read our detailed guide.
A car loan will eventually become a relevant scenario for most Germans. No other type of credit is chosen as often as the car loan in addition to the standardized installment loan. That’s because every year millions of Germans finance a car. If you are considering financing, you should know some things about a car loan. With the right knowledge and knowledge of the necessary tricks and tricks, you are in the negotiations much better positioned and can save so much money.
Is buying a car at the dealer always the cheapest?
Before a car loan can even become a reality, you should first find a suitable car. If you have already decided on a brand, it often makes the most sense for you to check with the nearest dealer. If you are not sure about the brand yet, you can compare the offers from various local retailers. But contrary to the widespread assumption is a purchase at the local dealer almost never the cheapest solution. This applies to both new and used cars. Instead, online portals are also outperforming classic retailers in this area. If you are looking for a cheap car, it may make sense to head for comparison portals on the Internet. There, national dealers hire offers for the purchase of a vehicle. These offers are often cheaper than at your local dealer. If dozens or sometimes even hundreds of providers compete, usually much more attractive prices.
If you do not necessarily depend on the advice of a regional dealer, buying a car on the Internet is certainly an option. In most cases you have to deal with a normal dealer – this is just not on your doorstep. Also, when buying used cars, you should, of course, before car financing, worry about where to buy the car. Again, either local dealers offer (tip: New car dealers also often sell used cars) or the comparison on the Internet. Due to the larger and above all supraregional offer you will find on the Internet usually a much better choice. If you have no particular relationship with a local retailer, making a purchase over the Internet usually makes a better deal financially. However, professional advice and on-the-spot handling without major detours are not negligible.
What makes a car loan different from other loans?
Basically, you do not necessarily have to rely on a car loan. In principle, you can finance a car with an installment loan. A glance at our credit comparison quickly shows you that even for such attractive offers can be found. However, the car loan is sometimes still on.
This is mainly due to the fact that banks usually attract better interest rates than normal credit due to their lower risk. The main reason for this is that the bank can rely on the car as collateral for a car loan.
Similar to real estate financing, you can look forward to interest rate advantages over a normal bank loan.
Generally, you have to hand over collateral to a bank for a car loan. If you do not finance your car directly with the car dealer, you usually have to deposit the vehicle letter with the bank. This rule is usually valid for the entire duration of vehicle financing. Only when you have completed the financing, you will receive your car letter and thus the official title deed for your vehicle.
Accordingly, they can not simply sell the vehicle, for example during periods of financial shortage. Rather, if you can no longer pay your installments, you will need to find a separate solution with your bank.
You may be wondering how such funding actually works.
Actually, you get the car letter so only as soon as you bought the car. This, in turn, is possible only after payment, but this works only with a previously paid credit. To make debt financing possible for cars, most banks offer a so-called security transfer. You must agree to such a safety transfer upon completion of the loan and then receive the loan before you buy the car. Once the purchase is completed, you must send the vehicle letter to the bank as part of the security transfer. This holds the car letter then until the end of vehicle financing.