Motor Money Matters
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With the economy being stuck in a downturn and the rising cost of living (especially food prices), everybody seems to be cutting costs. Many people need to take out loans just to survive, but they need to be careful about where they go, because there are many places with high interest rates that do more harm than good.
The ideal situation is to stay debt free, but this is not always possible when school fees must be paid and fuel prices keep rising.
Some loans are harder to get then others
Buying a car is more difficult than previous years when, credit checks were not as strict and loans were not so difficult to obtain from financial institutions. These days, many people drive their cars to the end of the vehicle’s lifespan, as new cars are expensive.
Everybody needs money to survive, as well as insurance to protect the assets that they have against crime, damage and disaster. Fortunately, there are many insurers and financial institutions that offer products and loans that have the consumer’s best interests in mind. These companies are linked to a regulatory board that ensures fairness to the consumer or client.
Buying a car is never a simple process, and financing can be a nightmare to get if you don’t have the proper documents and forms. There are many types of contracts or loan types for vehicle finance that can confuse the prospective buyer.
Let’s uncomplicated it
The first step is to apply for financial backing from a bank or credit provider. It is recommended that the client gets as many quotes as possible to compare repayment plans and interest options. Apart from the practical considerations, such as the car’s make, model and features, the following financial questions should be asked:
From a finance point-of-view:
- What size deposit can be put down, and how will it affect the monthly payments?
- Does the dealership give discount for upfront deposits?
- What is the interest rate on the payments?
- What are the options regarding the payment period? Can the car be purchased over five or six years and what are the differences in installments?
- Are payments fixed or will the amount vary with the interest rate?
- Are there any hidden costs or increases in the installments?
- Are there ways to pay off the car faster by paying extra during the months when the budget allows? What bank charges and administrative tasks, if any, are associated with these extra payments?
From an insurance point-of-view:
- Is there a preferred insurer or can the buyer use any company to insure the vehicle?
- Are there special deals with certain insurers that are linked to the car dealership?
- Does the insurance company provide a courtesy car if there is a claim or theft?
- How fast are claims settled?
- How labour intensive is it to claim? Is it the vehicle owner’s responsibility to claim or will there be assistance from insurers?
- What is the excess payment on insurance if a claim is made?
- What are the details covered under insurance? Are the car’s contents covered or is it just the external body of the vehicle?
Buying a car is an expensive, life-changing decision. You can increase the value of your car to get your money’s worth, and extend its life by servicing it regularly and keeping it in optimal condition. Keep the tyres at the right pressure, complete regular checks, and keep the car tidy to obtain maximum usage from the car. The more reliable your car is, the better your chances of getting a good selling price when you want to move on.
