Regardless of the fact that a personal loan doesn’t hold the noun “car” in the title, that doesn’t mean you are unable to use a personal loan for purchasing your dream car. But the question is – which loan presents more advantages to you? Keep on reading to find out.
Personal loans allow a borrower to use the loan to finance a holiday, renovations, studies, including the purchase of a car.
Personal loans present you the possibility to borrow a particular amount of money, which you will make repayments for either weekly, fortnightly or monthly until you manage to make all the repayments. Still, there’s something you should take into account: the longer the term of the loan is, the higher the interest will be.
Personal loan a usually unsecured loans and because of that additional risk it usually comes with a much higher interest rate than a secured loan
Therefore, before deciding to purchase a car using a personal loan, you should look at a secured car loan which provides a much better overall outcome
A car loan is not very different from a personal loan; the only difference is that a car loan does not provide the funds to finance anything but a car and the finance is secured against the asset, which in this instance is a motor vehicle.
The central distinction between a personal loan and a car loan is that car loans are secured & with that additional security comes better interest rates and cheaper fees.
Car loans duration can last from one to five years, and this period will be established before signing the contract. You will be required to make repayments until that particular date.
All in all, if its car that your looking to purchase, so long as its not too old, in almost every case its best that you look at a car loan over a personal loan in every instance.