The French and the automobile
Since the beginning of the millennium, the car has been used less and less by the French. From 84% 10 years ago, its share in domestic passenger transport fell to 81%. Awareness of ecology certainly played a role, but above all, owning a personal vehicle involves significant costs of fuel, insurance and maintenance. Not to mention his purchase, which requires an adapted financing solution, among which is the repurchase of car credit.
Who is car loan for?
The car loan consolidation concerns all borrower profiles : employees or retirees, owners or tenants, etc., who have gross monthly income greater than $ 1,500. However, it excludes people in a prohibited banking situation, and for tenants, those with FICP records. In addition, a car loan can only be included in a restructuring if the past term is less than the remaining term to be paid.
To avoid long and complex procedures with banks and loan companies, contact an intermediary in banking operations (IOB). He takes care of all the formalities and the trust capital he enjoys with the various financial organizations increases the chances of acceptance of your file.
If you have already used consolidation, a second request is possible after one year, provided that no payment incident has occurred.
The different types of auto financing
If, like most motorists, you cannot afford to buy your car for cash, there are different options available:
- The credit allocated is attached to the car purchase contract, to the exclusion of any other goods or services. The funds are only made available once the sale has been concluded, and the loan is automatically canceled if the transaction is unsuccessful;
- Personal loan is a type of consumer credit that can be used without proof by the subscriber;
- The car package includes, in addition to vehicle financing, various services such as insurance, periodic reviews, assistance in the event of a breakdown, etc.;
- Rental with option to purchase (LOA), also called leasing, or long-term rental (LLD) allow you to use a car without bearing the related fixed costs. With the LOA, you have the possibility, at the end of the contract, to settle the balance and become the owner of the vehicle;
- The car loan buyout is for buyers who already have a loan in progress or want to buy their car without reducing their lifestyle.
Redeem credits to finance a new car
When your vehicle gets too old, breaks down, or your family grows, you need to replace it. To finance this acquisition, whether it is a new or used car, consider buying a car loan.
It is an ideal solution to acquire the vehicle you need without affecting family finances or sacrificing other spending items. It provides you with the necessary cash flow with flexible repayment and reduced monthly payments.
At fixed or variable rates, this option is generally more attractive than the products of financial institutions or the financial subsidiaries of manufacturers and resellers.
Your budget is under control, because you know in advance the purchase price of the car, but also the elements relating to financing: interest rate, repayment period, amount of monthly payments, total cost.
Warning when purchasing a new vehicle
For the purchase of a new car, many manufacturers partner with lending establishments or insurers to offer a “car pack” including credit, damage insurance, assistance, maintenance and an extension of manufacturer’s warranty.
Some of these packaged offers cannot be redeemed, at the risk of losing the guarantees provided by the supplier. In addition, their composition is very varied, each formula having its own advantages and constraints. Also, before committing to this type of contract, check all the special clauses!
The advantages of buying car loans
Effective alternative to classic car credit
When your debts accumulate, some conventional establishments may refuse to grant you the loan you need to buy your car. The reasons: the application of laws governing consumer credit (which includes car loans) to combat over-indebtedness, or a risk of non-payment of bills deemed too high.
The auto loan buyout allows you to acquire a quality vehicle that meets your expectations while keeping your finances under control. The operation consists in repaying all your previous credits in advance and replacing them with a new contract whose monthly payments are adjusted according to your resources.
It is also a tool to lower monthly payments that have become too large for a current car loan and that you are starting to have trouble repaying. You end up paying for your vehicle without dreading its weight on your budget or disrupting your daily life.
Compared to other vehicle financing formulas, grouping a car loan gives you a preferential interest rate, reducing the overall cost of acquisition. The larger cash flow also allows you to buy a car of a higher range, or to switch from a passenger vehicle to a family car. This financial package can also be used for a motorcycle or a scooter, or even a motorhome or a caravan.
Committing to one or more years is not without risk, despite the best of budget planning. Indeed, no one is immune to a life accident. The grouping of car loans is more flexible by allowing a deferral of maturities or a modulation of their amount. You have time to overcome this blow, especially since for many offers, these options are free.
Thanks to auto loan buy-back insurance, if the vehicle concerned is stolen or destroyed, compensation allows partial or total early repayment of the financing.
How to find the best auto loan buyout?
To choose the offer that best meets your needs, you must take stock of your financial situation.
The objective: check your debt capacity! To do this, you must list in a precise and exhaustive manner your regular cash inflows and outflows. Do not leave anything aside, the bank or the credit organization to which you request the consolidation will use all these elements to grant or refuse your request.
To help you, many simulation tools are available. They allow you to have an idea of the conditions to which you can claim (in particular future monthly payments) on the basis of the criteria which you indicated.