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3 Good Reasons To Choose Secured Car Finance
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Buying a new or pre-owned car is a very exciting time for most people. However, for many of us the option of purchasing a high priced item like a vehicle outright is sadly just a pipe dream. Realistically many people need to secure financing when they want to buy a vehicle. When looking for new car finance deals, Australia-based drivers can easily become confused by the sheer number of options available. Many financial experts believe that secured finance is the best way to finance your next car purchase and here are three reasons why.
Understanding Secured Loans
Understanding how secured finance works is crucial for the cost conscious car shopper. A secured loan has the benefit of having a lower interest rate compared to most other kinds of personal loan. The reason for this is that the loan is actually secured on the vehicle that the applicant is buying. This means that if there is a default on the payments the car may be seized and sold to pay the outstanding amount. Obviously this is preferable to an unsecured loan as the loanee would have to find the full amount that needs to be paid from their own funds. In many cases, the sold vehicle alone will cover any shortfall and the defaulter may walk away owing nothing. However, if the vehicle cannot be sold for an adequate amount any deficit will still need to be paid by the buyer.
2. Fixed Interest Rates
The secured loan is usually offered at a fixed interest rate that is arranged prior to buying the vehicle. This ensures that the buyer has a clear understanding of the monthly amount that needs to be paid. This amount cannot be changed and it offers a certain amount of regularity when considering a monthly budget. Obviously this can be very helpful if the loanee has a good handle on their finances. When considering new car finance deals, Australia-based drivers need to have a clear understanding of the monthly amount that can be afforded is crucial here. Many people fail to take into account other vehicle related monthly costs such as fuel and insurance.
3. Early Completion
Some people have a financial windfall and decide to do a little financial housekeeping and pay off all their debts. As an admirable sentiment as this is, it may not be the best course of action when related to a secured loan. The reason for this is that many secured loans have a financial cost for early repayment before the completion date. This is one of the few downsides of a secured loan, but the lower fixed interest rates are better for most people.
If they are looking for new car finance deals, Australia-based drivers should contact us at (08) 9416 0888. Our Subaru car finance deals are affordable, flexible and tailored to your individual circumstances. If you would like further information get in touch with us today, and our team are here to address any queries that you might have.
City Subaru is your number one local, family owned Subaru dealership in Perth, providing great service, and quality vehicles across 2 locations in Vic Park, and Maddington, so you’ll be able to start your next adventure in a brand-new City Subaru.
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