Put Your Foot Down
Working hard? We hear you. To be successful you know you have to put in the effort but that doesn’t mean there should not be rewards. If it’s time for a new car, let’s talk.
New car finance
When you’re looking to finance a car purchase, you may consider using a broker to help you find a suitable car loan. A broker is an intermediary who acts on your behalf to find loan options from multiple lenders. They work with a range of lenders and compare rates and terms to find you a loan that best fits your needs and financial situation.
Using a broker for a car loan has several potential advantages, including:
- More loan options: Brokers have access to multiple lenders, so you may have more loan options to choose from than if you were to apply to lenders individually.
- Expertise: Brokers are typically experienced in the car loan market and can help guide you through the loan process, answer your questions, and provide advice on loan terms and interest rates.
- Time-saving: Applying for multiple loans can be time-consuming and confusing. A broker can help streamline the process by handling the paperwork and negotiating with lenders on your behalf.
- Better rates: Brokers can sometimes negotiate better rates and terms with lenders than you would be able to on your own.
Car loan types
Secure loans and unsecured
There are generally two types of car loans available in Australia: secured car loans and unsecured car loans.
- Secured Car Loans: A secured car loan is a type of loan where the car serves as collateral for the loan. This means that if you default on your loan repayments, the lender can repossess your car to recover their losses. These loans generally have lower interest rates because they are less risky for the lender. However, you’ll need to provide security in the form of the car you intend to buy.
- Unsecured Car Loans: An unsecured car loan is a type of loan where the lender doesn’t require you to provide any security for the loan. This means that you don’t need to put your car up as collateral, but the interest rates on these loans are generally higher than secured car loans. They are typically used for purchasing older cars, or for those who don’t have a car to use as collateral.
Additionally, there are other types of car financing available, including hire purchase agreements and personal loans that can be used to purchase a car. It’s important to carefully consider your options and compare interest rates, fees, and terms to determine which type of car loan is right for you.
Chattel Mortgage
In Australia, a Chattel Mortgage is a popular form of finance used by businesses to purchase vehicles, including cars. It is a type of loan where the lender provides funds to the borrower to purchase a vehicle, and the borrower provides the vehicle as security for the loan. This means that the lender has the right to take possession of the vehicle if the borrower defaults on the loan.
Here are some key features of Chattel Mortgages for car loans in Australia:
- Ownership: The borrower owns the vehicle from the outset, unlike a lease where ownership remains with the lender.
- Repayment terms: Chattel Mortgages typically have fixed interest rates and repayment terms ranging from one to seven years.
- Tax benefits: If the vehicle is used for business purposes, the borrower may be able to claim tax deductions on the interest charges and depreciation of the vehicle.
- Deposit: Borrowers may be required to provide a deposit or trade-in to reduce the amount of the loan.
- Balloon payment: A Chattel Mortgage may include a balloon payment, which is a lump sum payment at the end of the loan term. This can help reduce monthly repayments but means that the borrower will need to pay a larger amount at the end of the loan term.
- Fees and charges: Borrowers may be required to pay fees and charges, such as establishment fees, early termination fees, and late payment fees.
It’s important to note that Chattel Mortgages are typically only available to businesses and not individuals. Additionally, lenders may have different requirements and conditions for their Chattel Mortgage products, so it’s important to shop around and compare options before making a decision.
Use Prospera Finance to negotiate on your behalf
Let us compare options from the leading lenders and negotiate on the one that really works for you – so you never lose sleep wondering if you missed out on something better. With our expert guidance and answers to your questions, you can feel confident about your decisions.
Should you choose to do business with Prospera Finance you won’t pay us any fees for our services. We will receive a commission on settlement from the lender that provides you with the best-suited loan.
If you are thinking about a new car loan or a nearly new car loan, we would love to help!