Six tips for a car loan
Most clients who take out a loan with us do it to buy a car. If you’re also looking to finance a new car, our personal loan might be the product you’re looking for. In this article, I’ll be giving you six tips that you might find useful.
1. Use your savings
It’s not really a loan tip, but I’ll pass it on anyway: if you have savings, use them (or part of them) to finance your car. That’s always cheaper than borrowing. Just make sure that you keep enough to cover unforeseen expenses, like repairs, for example.
2. Choose certainty
A personal loan is a good way of financing a car. You can buy the car immediately, as the money is transferred into your account in one go. What’s more, you know exactly how much your monthly repayments will be and how long you’ll be paying off the loan for. This gives you certainty. You can borrow between €5,000 and €75,000 with a personal loan.
3. Calculate your monthly repayments
This can be tricky if you’ve already found the car you want. But don’t decide too quickly if you’re buying it with a loan. Calculate your monthly repayments in advance and figure out whether you can afford them. Our online calculation tool will make this easier. And don’t forget that you’ll need to pay for other expenses, such as fuel, insurance and road tax. You need to be able to afford these too.
4. Consider the loan term
We call the time you have to repay the entire loan the ‘loan term’. Think about the period you intend to use the car for, and set the loan term for a period that is shorter than this. This way, you won’t still be paying for the car when you’re no longer using it.
5. Extra repayments are a good idea
Your car loses value every year. We call this depreciation. If you find yourself with some spare cash, make an extra repayment on your loan. This will help to keep the amount of your loan in line with the value of your car. And if you sell the car before you’ve repaid the loan, it’ll be easier to pay off the remainder using the proceeds from the sale. It’s good to know that you can always make extra repayments with us at no charge.
6. Don’t forget about insurance
Unfortunately, some accidents are just waiting to happen. Causing damage with your car can be an expensive business. Third-party liability car insurance is compulsory in the Netherlands, even if you aren’t actually using your car. This insurance only covers the damage that your car causes to third parties. If you’re borrowing money to buy a car, it’s a good idea to take out fully comprehensive insurance so that you’ll be able to claim enough to repay your loan if your car is stolen or written off. Go to our website for a full overview.