There are five core loan elements that contribute to your car loan repayments. You need to understand them if you are to make an informed decision on your new car loan:
Total Vehicle price – This is the final price of the vehicle as listed in your Contract of Sale. This price will include on-road costs such as stamp duty, CTP insurance and registration, along with other Dealer costs.
Term — The term length is the amount of time it takes to completely repay the car loan with interest. Common term lengths are 3-5 years or (36-60 months).
Interest rate — Interest rates represent the amount of interest you pay until the auto loan is paid in full. Interest rates for car loans can vary widely, depending on your credit history and other factors.
Deposit — A deposit is the percentage of the vehicle price that is paid by you to the Dealer up front. Depending on the type of car loan deposits can be as low as 0%. In most cases deposits are in the range of 10% – 20%.
Balloon / Residual — Is the amount of money to be paid back to the Lender at the end of the term. Paying a balloon/residual at the end is a way to lower the monthly repayments. In most cases we can offer balloons up to 30% on commercial vehicles.
