3 Common Car Loan Mistakes People Make
The experience to have a new car is fantastic and the excitement keeps on growing till the day the new car is parked in front of the house. Although men are known to love their cars, in Pakistan its usually the family affair. Days and weeks are spent window shopping to decide which make and model suits the best. Buying a new car for a middle-class family is a mentally draining experience and a huge burden on their income and savings. Since the savings are limited the purchase therefore largely depends on obtaining an auto loan.
As soon as the decision is made, the make and the model chosen the next step should be to hunt for the best auto loan available in the market. The buyer has many options to explore; study the requirements for auto loan application on line and then apply car loan on line. Since the excitement to own the car keeps on escalating, in this state of mind the buyers either forget or are unaware of the process to be followed to acquire auto loan and depend on the auto dealer to their work.
Making an auto loan application is not that tedious, either you apply for car loan online or do it in person. Below are 3 common mistakes people make while they apply for the car loan, if these are considered chances of approval for auto loan application increases manifold:
- There are hundreds of options available to apply for a car loan. With ease of an internet, identifying which car loan best suits you and the eligibility can be done fairly easy. A person can either apply for car loan on line or if need be make a personal visit. An option for Islamic car financing is also accessible besides conventional auto loan. The most important point here is that a buyer must apply for the car loan himself rather than to depend on a car dealer or any other third-party arrangement.
A car loan application filed by the auto dealer has more chances to be rejected by the bank or a modaraba company then a car loan application filed by you. This is because you know your finances better, your real income, credit score and your eligibility. Many new buyers make a crucial mistake on depending on a car dealer. The dealer smells your excitement and desperation, he is more interested to sell his automobile rather than to look for your financial interests. A person feels overjoyed that he has haggled successfully with the car dealer and had a good deal on the car. In actual terms this is not so, the interests that you would have paid in coming years is far more
- It is suggested to have your auto loan application approved before you walk into the car dealer. This would have defined your budget and you will be constrained from overspending and eyeing for a model that perhaps does not suit you. Otherwise, if you have not applied for the car loan the car dealer may fleece you with an expensive car loan and a car that in the long run will not be feasible to maintain
- It is but an intrinsic nature to pay less. What is in front of the buyer is the monthly installment, this drives people to go for a long-term auto loan not considering that in the long run they have paid far more then the actual cost of the car. Instead, a person should carefully examine his income and expenses and arrive at a figure he can easily pay as a monthly installment. It is also observed there are scores of people who would apply for a car loan which offers 0% down payment. This may way work for many but largely it is classic case for people who live beyond their means.
A person must bear in mind that car is the second most expensive buy a man makes. Hence, all steps in this regard must be meticulously followed. Apply for a car loan after thoroughly investigating car loan online or by visiting the nearest branch. Once your research is complete and you are satisfied with the results only then submit car loan application.