Qs re Car loan?

My almost 20yr old son is buying a car %26amp; is looking at finance through a broker associated with the car yard. He has been told the loan of $8900 will cost him about $55/wk over 5 yrs. This is his 2nd car-he's trading in his existing car. He can afford the repayments %26amp; is sure that the car sales guy %26amp; broker are great guys %26amp; wouldn't rip him off. I seriously have my doubts!

I went to a loan calculator site %26amp; worked out that he can get cheaper finance through a bank/building society which reduces his payment by over $10/wk %26amp; the full loan repayment amt by about $1450.

I want him to make a wise decision about this and would be grateful if anyone can give me advice on what things he should be considering %26amp; looking for in a loan and what to avoid.

Also can someone tell me what happens if he sells the car in the future? If he sells the car within the loan period, can he just keep paying the installments or is he then up for the full amt of the remainder of the loan?

Qs re Car loan?

Banks do not offer 0% financing, only Manufacturers. The reason is because a bank would make no money whatsoever, where as a new car manufacturer would offer 0% or some sort of cash rebate. Either way, they still get their money.

Depending on how old the car is, getting 8.5% - 11% is not bad for a 20yr old. The older the car, the higher the rate, so if he is looking to buy a 2001 model, then 11% average. If you give a little more information about your sons credit history and the vehicle, we can answer better.

As far as selling it, he would have to pay off the loan before the lender would release the title. So if he wants to sell it in 2 years and still has a balance of $6,000, he would either have to sell it for atleast $6,000 or pay the difference between his selling price v/s his loan payoff. I hope this helps and you can email me if you have any questions.

Qs re Car loan?

if your son sells the car and there is still a loan outstanding then there will be a lein on the vehicle and he will have a hard time selling it . NO ONE will buy a vehicle that has a lien . If your son wants to buy a vehicle his best bet is to go through a bank, they will charge about 6 % a broker such as you are describing will charge about 35% they are loan sharks . In the end he will pay way to much or owe way to much . At his age if I were you I would save about 3500 and buy a car out right its the best thing to do TRUST me . Even a bank will not finance on a used vehicle at that price But if he is working has credit and can afford the payments a dealership may finance him for a BRAND NEW vehicle with 1000 down or zero down the payments are about 200 a month and the interest is about 1.9 % or even zero percent I hope this helps pleases let me know how things turn out for him good luck!! shaun stephenson

Qs re Car loan?

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Qs re Car loan?

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