Media post: Car Financing Advantages And Drawbacks

There are many places in the world where having a car is an absolute must for all those who need to work. Whenever public transportation can’t cope with the demand, people have to find a way to get to work, if they don’t want to lose their jobs. Some people can afford to buy a car with their own money, but most of us have to apply for a car loan to take some of the financial burden off their shoulders. As car loans come in many shapes, one has to spend time researching and comparing all these options in order to choose the right type of car financing for them. The easiest way to find the best car loan for you is to use a comparison engine or a loan calculator like Zmarta. Check them out now to see what kind of loan would best suit you.

Even though financing a car through auto loan is a convenient method to get your vehicle now and pay for it later, such loans come with risks you have to understand before everything else, for quick car finance click here. The two ways of getting your car loans are from a bank or through a dealer financing. Each of them has its pros and cons, as you are going to see in a moment.

Bank Financing

Pros

Easily Accessible. Even the smallest town has at least one bank. This means that you won’t need to travel too far to shop around for offers and to find the best deal. Furthermore, most banks make it easy for their clients to apply for such loans online.

The main advantage of getting your car loan through a bank is that you’ll be able to customize the repayment schedule to suit your specific financial situation. Depending on the size of your down payment and on the terms of your contract, you can create a loan repayment scheme that works for you.

Cons

Banks don’t grant their loan approvals that easily. They use rather strict criteria to filter their applicants, in order to ensure they will see their money back. One of the biggest drawbacks of a bank loan is the relatively high number of fees you’d have to pay. Despite their relatively low interest rates, bank loans aren’t as convenient as they seem. Also, the paperwork and the waiting times are nothing to wish for.

Dealership Financing

Pros

These showrooms are set to work as one-stop-shops for vehicles.

In-house financing is much easier to get, as long as you can show that you can afford to pay the monthly installments. You can apply, get approval and drive your new car out of the dealership in one go.

Cons

Dealership financing is more expensive, as interest rates are higher. This makes them riskier, particularly on a longer term.

Dealerships use hard selling techniques, so you may end up buying a car that you can’t actually afford or get extras you don’t need.