In all the excitement of buying a new car it can be easy to ignore the fine print in the finance contract offered by your car dealer. After all you need to make a lot of more pressing choices such as make, model, color, extras you would like to add to your vehicle etc. However there s not much point in negotiating down the purchase price with the dealer if you are then going to approach them for finance. There is much evidence that any discount given of the purchase of the vehicle will simply be taken back through the car finance contract.
ASIC has issued a warning on its Money Smart Website to car buyers setting out the risks in deciding to accept a car finance offer from a car dealer. Consumers need to understand where the risks are so that they are then able to make an informed car finance decision.
Paying for convenience
Consumers are easily swayed by marketing. Car dealer offers of cheap finance can appear too good to be true – why look elsewhere. Whats more there is no need to go anywhere for finance if the dealer is in fact a one-stop-shop.
However convenience almost always costs more. Given that some car purchases can go to tens and even hundreds of thousands of dollars, it pays to compare available deals rather than choose finance on the basis of convenience only.
Do not be afraid to ask questions
Do not assume that you will be getting the finance offer advertised on the dealer’s window. Ask if in doubt.
Unfortunately not all advertised offers of finance are available to every car purchase. Some of the cheaper rates on offer relate to ABN buyers purchasing a new vehicle. A consumer who has found a car of their dreams may think that they are getting the same deal as they see advertised, and even sign the paperwork not realizing that their cost of car finance is not 2.99% pa.
Car dealers are not experts in finance they could make a mistake with paperwork that will cost you more than you are prepared to pay. They could also hide some fees and costs in your finance contract that never become apparent until you check the paperwork. It pays to ask and be certain that you understand and are happy with the finance deal offered. There is nothing wrong with looking around for a better offer. ASIC recommends that you do just that.
Better car finance deals available online
You can find and compare car loan offers online. This means that it does not matter what hours you work, you are able to check car finance deals online 24/7. Once you have identified who offers what you should be ab;e to get a finance expert to help you apply and qualify for the deal of your choice without ever needing to visit a bank. It pays to check to make sure that the finance deal you select is every-bit as good as the car you are buying.