Introduction

To get a loan and buy a car without long-term savings, it is enough to perform a few simple steps

For many, a loan is the only way to buy a car. Thanks to banks and credit institutions, it will not be necessary to spend many years accumulating the required amount. To become the owner of your own car, it is enough to prepare a standard package of documents and perform a few simple steps. At the same time, some of them can be produced online today without leaving home.

The time from applying for a loan to receiving a personal vehicle classic car title loan is only a few days. In addition, the interest rate on car loans is much lower than on other types of lending. And you can use borrowed funds both to buy a new car, and to purchase a used car.

There is a simple step-by-step instruction that will help you quickly and safely get a car loan.

Step 1: Apply for a loan

First of all, the potential borrower needs to evaluate their financial capabilities. The amount of the monthly payment should not exceed 30% of the total family income. A suitable model and loan program should be selected based on this. Too expensive a car can cause a constant shortage of funds. It will be easier to determine the bank by compiling a table and writing down the conditions of various programs in it, which seemed most attractive.

You can apply for a classic car title loan in various ways. For example, fill out a special form on the bank portal or personally visit the office. Requirements for borrowers are usually posted on the official websites of credit organizations. Another way is to fill out a form on the dealer’s website, indicating the model you like. The car dealership manager will contact a potential borrower to clarify the details and independently send an application to several partner banks at once.

Step 2: Submit documents and wait for a solution

The list of documents that will be required to consider the application can be clarified on the bank’s website or from a loan specialist. The classic package includes a passport, income statement, a certified copy of the work book and a loan application. In rare cases, employees of financial institutions are additionally asked to bring a copy of a higher education diploma, marriage certificate, TIN, bank statement and other papers.

Recently, express lending programs are gaining popularity. In this case, the issuance procedure is maximally simplified: money is provided on the basis of a passport and any other document. For example, a driver’s license or military ID. The interest rate will be higher by 3–7%.

It may take from several minutes to several days to make a decision on the application, depending on the bank and the lending program. If the client’s solvency seems insufficient to the credit committee, he will be offered to look for a co-borrower or guarantor. He will share the responsibility for the loan and classic car title loan with the future car owner.

Step 3: make a down payment

The next action is the conclusion of a contract of sale with a dealership or an individual from whom the borrower purchases a car. At the same time, a down payment is paid. As a rule, it is from 10 to 50% of the value of the vehicle. Moreover, the rule most often works: the larger the value of such a payment, the lower the overpayment on the loan.

Step 4: Get your insurance policy

Most often, a Casco policy is a prerequisite for issuing a loan. Since the car will be the subject of collateral, it is important for the bank to protect it from all sorts of troubles. Therefore, such insurance must be valid for the entire loan term. At the same time, the bank is not entitled to make the client insure. Instead, he may set a higher interest rate or refuse to grant a loan.

Step 5: Conclude an agreement with the bank

After that, the buyer goes to the bank to sign a loan agreement and a pledge agreement. The latter limits the borrower's rights to dispose of the vehicle. That is, without the permission of the bank, the owner will not be able to sell the car, rent it out, reissue it to another name or make significant structural changes. Such actions may qualify as fraud.

Step 6: pick up the car from the seller

The bank transfers credit money directly to the account of the seller organization. The transfer procedure may take several days, after which the purchase will be considered completed.

The next step and the most important is repayment of the loan.

Car loan repayment is carried out by the borrower according to the schedule provided by the bank. If the loan is in foreign currency, funds are paid in currency, if in hryvnia, then in hryvnia. Non-cash transfer of funds from another account is also possible. In case of untimely making payments on a car loan, the bank will charge a fine, and in case of delay in payment for several months, it will begin the process of recovering the debt and will require the car to be returned in order to sell it to repay the loan.

The most common difficulties in repaying a loan and how to solve them:

- Temporary financial difficulties do not allow repaying the loan on time.

It is better to immediately contact the bank with a statement on the extension of the car loan and explain the reasons to the loan officer.

- The borrower cannot repay the car loan in accordance with the schedule.

You need to fill out an application for changes to the repayment schedule, indicating the reasons.

- The bank intends to increase interest rates on car loans (this does not happen so often).

If the borrower is satisfied, the bank will automatically raise the interest rate and offer to conclude an additional agreement to the loan agreement.

Conclusion

Drawing conclusions, we can say that taking a loan for a car today is a good option for those who do not have the full amount for classic car title loan, but there is a lot to do to get their own. Good luck with your purchase and a good road!

Important! Until the last payment on a car loan is paid, without the consent of the bank you can neither sell the car nor give it away.

 

Published by Matthew Piggot