Do you live in Johannesburg and need vehicle finance for backlisted? You may be overwhelmed at how difficult it is to find a solid car loan. However, by following some basic steps you can get the loan that you need for the vehicle that you want:
1. Learn your credit score (and credit history)
It’s important to learn both your current credit score, as well as your credit history–in order to secure vehicle finance for backlisted. Many people aren’t aware of either their credit score or credit history. However, both are important since they’ll influence the interest rate that a lender may tender you. Use can then use an online calculator to determine the maximum interest rate that’s within your budget. That should be based on how long you can make the payments, and the monthly payments that you can afford.
2. Shorten the loan period as much as possible
If possible, make higher monthly payments so you can pay off the loan faster. Once again, interest is the thing to avoid when you’re trying to consider vehicle finance for backlisted. Of course, you shouldn’t make financial sacrifices that will stretch your budget too thin. However, consider the opportunity cost. The sooner you pay off the loan, the more money you can save not only on the amount of the loan itself, but also on the interest that you would have paid during a longer loan period.
3. Make a huge down payment
Why is this important when securing vehicle finance for backlisted? This will significantly reduce the amount that you’ll need to borrow-and how much you’ll be charged interest on. Speaking of interest, there’s no guarantee that you’ll be able to find an interest rate that’s relatively low. Thus, it’s particularly important to make a downpayment that’s as large as possible.
4. Avoid selling the car to make loan repayments
While classic cars appreciate in value, when securing a vehicular loan keep in mind that that’s not the case with new cars. In fact, their values tend to depreciate quite quickly. Thus, consider getting a part-time job, selling your vintage baseball memorabilia, or borrowing from a close friend or relative. However, you should definitely avoid selling the car itself, as the opportunity cost isn’t worthwhile.
5. Don’t give up if you have either bad credit or have no credit
If you have a steady source of income, a healthy downpayment or a spotless driving record, then you can still secure vehicle finance for backlisted. The deal you get may not be as good as you would receive with solid credit. However, keep in mind that the lender basically needs to be assured that you’ll be able to repay the loan. While good credit is one of the best indicators, it’s not the only one.
When purchasing a vehicle in Johannesburg, these tips will help you to borrow the funds that you’ll need. Sometimes it may seem impossible to secure the new car that you want. However, you can do it by using some basic tried and true methods.