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While most of us wouldn’t like living in the bush, oz is a grouse country to live in. Unfortunately, Aussies are the most indebted people – as a nationality – in the world, with the average household earning less than half of their annual income. According to the Organization for Economic Cooperation and Development, a worldwide organization composed of some of the world’s most advanced countries, the proportion of household debt to yearly income is 1 to 2.12 – the highest in the developed world!
As such, it’s common for Australians to take on a car loan, rather than purchasing a vehicle for cash. However, most developed places in the world finance the purchase of vehicles, rather than buy them outright with cash – maybe not Luxembourg, the richest place in the world, though – wishful thinking.
Here are several things you need to keep in mind when shopping for a vehicle and accompanying Car Finance at Stratton.
Can you provide proof of income?
Most of us have some level of income, even if it’s from government assistance programs. However, having income doesn’t mean one can afford to purchase a vehicle.
Oddly enough, the lower income you have proof of, the more expensive your car loan will be. If you’re considering asking for a promotion, finding a new job, or even have a guaranteed promotion on the horizon, consider putting off your vehicle search for a few weeks or months. Being able to prove higher income will certainly lower interest rates.
Further, a failure to provide proof of income might result in ultra-high financing charges, if not the denial of a car loan.
Offer to swap your current vehicle
There are plenty of situations where you wouldn’t be willing to swap your car for another – it’s of sentimental value, the car yard isn’t offering enough value, etc. However, most car yards are willing to work with car buyers seeking a car loan.
Don’t make your intentions to swap vehicles clear to car yard associates, as they might offer less for the vehicle than what it’s worth. Prior to agreeing to car loan agreements, thoroughly research the value of your current vehicle.
Obtain a credit guide
In Australia, dealers must provide a credit guide to consumers interested in car loans that ask for such documentation. Licence number, full tables of financing fees, and EDR information will all be provided, helping you be fully informed about how fair your potential lenders’ financing fees and interest rates actually are.
Don’t agree to business purpose declarations
Australian, American, Chinese – whatever the nationality – some people on this planet are dishonest. Consumers that use their car for business can declare it as a business-purpose vehicle. When getting a car loan, if a dealer tells you they can lower your payments using such a declaration, immediately find another car yard.