Getting a bank loan or personal loan from building society or bank can help in raising finance if you want to buy a car. It is also a cheap way to borrow money because you ca easily get a good rate but what you should know is that bank loans and personal loans are different names which serves different purposes. You can make use of a personal loan for down payment on car whether the car is a used one or a new one, the choice is yours to make. One more thing you should know is applying for personal loans affects your credit in return.
Personal Loan For Down Payment On Car
We stated earlier that applying for a personal loan would have an effect on your credit and this is because the lender giving you the money would have to check if he can trust you to pay back. This is why it is advisable to make use of an eligibility calculator to check the impact on personal loans on your credit rating. You should check the monthly repayment amount as well as the total amount so you can end up with an affordable option that would not cost you so much when it comes to paying back.
Taking a personal loan for down payment on car has its own advantages and disadvantages. Take a look at some of its pros and cons;
Pros Of Personal Loan For Down Payment On Car
- It comes with fixed interest rates but it is advisable for you to always check because they might vary sometimes
- Taking personal loans is one of the easiest ways one can finance the purchase of a car
- Getting a personal loan can be gotten face to face, through the internet or over the phone
- You can take a personal either to make up the money for the purchase of the car or to make the entire purchase
- You can select a preferable loan period but remember that the longer the period of loan, the longer you have to pay up its interest rate
- Getting a personal loan for down payment on car means you already own the car while working to clear off the loan debt and this means if you run into financial difficulties, you can end up selling the car
Cons Of Personal Loan For Down Payment On Car
- Its monthly payments might be higher compared to other forms of finances but this is dependent on the costs and terms
- You would need to be patient for the money to be made available although there are some lenders that would make the money readily available
- Getting a personal loan for down payment on car means not being able to get any of the advertised rates
- Since you bought the car through taking a personal loan, you are one hundred percent responsible for all of its repairs
- There is a possibility that you might end up borrowing more money than you intended
It is very possible for you to own a car through personal or bank loan and you can buy through dealership or privately because as long as the money is already in your account, it can be treated like it is your own cash. It is also necessary that you make use of a loan calculator to figure out how much you would need to pay each month and how long it would take you to pay off the amount you want to borrow when you finally decide on taking a personal loan as down payment on car. Compare different loan rates and lengths as well.
Cooling Off And Canceling Period
After taking a personal loan, there is a period known as the cooling period and this is a period of fourteen days where you have to think whether taking a personal loan is the right move for you and if after having these thoughts you are not convinced that you need the loan then you can go ahead and cancel it. Canceling during the cooling period simply means that you owe the interest and capital that has built up within the short period of time you took the loan and this money needs to be paid back in about thirty days.
Canceling the loan doesn’t mean that the agreement you have to get the car from dealership should be canceled as well. It simply means that you have to look for some other means to purchase the car you want.