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What's the best car finance option?

6 October 2017
 by 
, CarsGuide

The great thing about buying a car is... well, everything. The joy of ownership, particularly if it's a new vehicle (or even if it's second-hand, but something you've always wanted), is hard to describe. The shopping process is pretty fantastic, too, because there are so many choices, and so many options for personalisation.

Everything is great... except the money part. Unfortunately, Australia does not have the cheapest cars in the world, and even with some very good cars available for under $20,000 today, that still means a finance deal for most of us, and borrowing money is, generally speaking, a rather long way from great.

Many of us are already in debt to the banks for our mortgages, and consumer sentiment seems to suggest none of us are very happy about it. Adding to the amount you owe to those giant organisations is an unpalatable choice for many.

Your car dealer will, of course, offer to get you a finance deal, but the deal you get on borrowing money from your dealer is going to be beneficial for them (they're likely to get a cut, or at least incentives), but that means it's likely to cost you more.

Big car companies also offer finance, but again, they're doing that to add to their already sizeable profits, and you're about to give them enough money. Besides, it's impossible to know what per-centage of your finance rate is tied up in the actual cost of the car, and if you're getting a good deal in one place, it's a sure bet you're getting a worse one somewhere else in the transaction.

What a lot of people don't realise is that finance is available from a name you already know, and trust - the NRMA - and that if you're a member you can even get a further discount on rates.

Having the money ready to go is an absolute must when negotiating with car dealers.

What you really want from a car loan is flexibility - so you can choose how and when you pay, and whether you want to make extra top-up payments from time to time - low, competitive rates and as little red tape and form-filling slowing the process down as possible.

Having the money ready to go is an absolute must when negotiating with car dealers - or private sellers if you're buying second-hand - because it puts you in the box seat. "I'm ready to buy, right now, do me a deal or I'm out of here".

The NRMA, which has been providing roadside assistance for almost 100 years, has a quick application process with pre-approval inside five business hours, and there are no monthly fees. And in most cases, the funds will be available the day after approval. They offer a refreshingly no-nonsense approach to explaining the process, too.

You can get a loan for a new or second hand car, motorcycles, motorhome, caravan or even a boat from 6.99 per cent.  And they make the maths easy, providing a car loan calculator to help you work out your estimated repayments.

Once the funds are approved, and the paperwork is done, your money will be available to spend the very next working day, and you can start enjoying the shopping process. And get back to the sheer joy of car ownership.

What's your best car finance tip? Tell us what you think in the comments below.

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