When researching your car finance options, you’re likely to have come across both fixed and variable rate car loans, so it’s important to understand how these differ. While the majority of car financiers offer fixed rates, it’s not uncommon for borrowers to opt for variable rate loans instead. They’re simply personal loans with a non-fixed interest rate.
Although fixed interest can provide stability of repayments, variable rate products afford you greater flexibility in how you make use of your funds. These loans may help you save money on your repayments when market rates fall. Additionally, they’re unsecured, so there’s no need to tie an asset to your loan.
Savvy can help you find a variable rate car loan today by comparing from our range of flexible lenders and products.
With comparison rates starting from 6.47% p.a. and some fees able to be waived, you can find an affordable option to suit your car financing needs.
Because your interest isn’t fixed at the beginning of your loan, you’re in the best position to enjoy loan savings if your interest rate falls during your loan.
Your lender will be able to automatically approve your initial application within 60 seconds and send your funds directly to your account in one day.
With a variable rate loan for your car, you can borrow any amount from $5,000 up to $50,000, provided you can support your repayments comfortably.
You also have a say in the cost of each repayment by choosing your preferred loan term, allowing you to ensure they’re manageable for you.
Unlike a standard car loan, you can buy a car older than 20 at the time or purchase or dedicate funds across different areas as per your needs.
Because your loan is unsecured, you won’t have to put a valuable asset, like your car or another vehicle, up as collateral for your loan.
You can opt for either weekly, fortnightly or monthly payments to suit your personal income situation, adding further customisability to your loan.
Although they’re very similar in structure, there are distinct differences between personal loans and car loans. Car loans, while maintaining the same minimum loan amount, have no real upper limit; you can generally apply for up to 100% of your car’s value up to your maximum borrowing power.
In addition to all of this, while you can opt for variable or fixed interest and no security on a personal loan, all car loan interest rates are fixed and all are secured. These are two factors that are important and should be factored into your decision making when it comes to choosing a car loan.