Finding a car that you love is one thing, but being able to find the right way to finance it is another ball game that can be daunting. But do you know the type of car buyer you are? The type of lender you choose can affect the car buying process. Here is what you need to know when it comes to your options to make owning a car easier without the financial weight.
Buyers who go to a dealership
Buying a car through a dealer versus purchasing it online or through a private sale is a constant debate for consumers. To help make an informed decision Roy Morgan found that 67.6% of Aussies turn to the internet to inform them. In the end, 39% of consumers decide to head off to a dealer to help them finance their car.
Dealers could offer you a lower interest rate, but this could be limited to specific models. Not doing adequate research into purchasing a car at a dealership can have adverse effects on your finances. This can cause consumers to be sucked into a sales pitch to purchase a car that comes with additional add-ons that will have them forking out more.
Buyers who go to the bank
Buyers who approach a bank are more money conscious and have a budget in place. It can also be useful to approach a lender that already has your financial information, making it easier for them to see if you will be able to afford the car that you wish to purchase.
The benefits for people that approach a bank is that they are able to get access to a pre-approved loan. This, in turn, can help increase their negotiating power when purchasing a car. However, consumers also need to be aware that it could be harder to negotiate a lower interest rate with a bank.
Buyers who go to a broker
Brokers play a significant role when it comes to helping Australians purchase their new set of wheels. According to the Royal Commision, brokers form part of the 61% of other sources that provide financing for Australians that want to purchase a car.
Brokers offer consumers a wider variety in terms of competitively low loan rates. Brokers are able to connect you to lenders that are suitable to your credit profile and select the most suited loans with the best possible interest rates and features for you to choose from.
Always keep in mind that not all lenders are the same and not all loans come with features that are tailor-made for you, and this is why it is important that you compare your options. This also means that you need to take time when researching your options so that you won’t experience the pressure of having to make an uninformed decision later.