These days, owning a car is becoming a necessity instead of a luxury. Everyone’s headed to the office every single day, parents have to drive their children to school, and families need a car that they can always use for the holidays.
However, not everyone can afford a brand new car and paying it upfront is kind of not an option. The good news is that you can turn to car finance if you really need one but still can’t afford it. All you have to do is listen to our advice, and you’re sure to get the car that you need to make your life more comfortable and convenient.
1. If possible, clear any debts that you still owe. Sure, there are car finance companies that give people with bad credit a chance, but paying your long overdue debts is a very good indication that you can actually pay your loans. Lenders usually trust those people with good credit and showing that you can be responsible with your finances will up your chances of getting approved.
However, if you have an existing credit that you really cannot pay just yet, then just make sure to submit the proper documents that show that you have the capacity to pay. You can also include records showing that you regularly pay your loans – whether instalment or a one-time payment.
2. Check your budget and stick to it. As they always say: “Live within your means”. Sure, getting a car loan is not exactly living within your means, but as we’ve mentioned earlier, having one is definitely becoming a necessity rather than a luxury.
With this being said, you should carefully check your budget and look for a car that’s within your range. Never go overboard and get one just because you want the model – you can do that later when you have the right budget for it.
Also, you should take everything into consideration: the stamp duty, insurance, registration, and ongoing maintenance costs – as these things can easily add up.
3. Make sure to submit the required documents, even the optional ones. Submitting the documents on time or even earlier shows that you are decided to push through with the application.
Most car finance companies ask for the application form (personal details, bank details, employment history), payslip or proof of income, driver’s licence, and proof of address. Make sure to prepare these even before applying, so you’d have a bigger chance of being approved.
4. Get pre-approved. This step makes the negotiation with the lender easier. By doing this, you’ll have a higher chance of sticking to your budget and not going overboard. You will also find out what the lender is willing to do for you, plus you also avoid last-minute surprises.
Lastly and most importantly, these question will be answered: How much can I afford? How much are my weekly or fortnightly payments going to be? What interest rates are available? Surely, getting pre-approved has more pros than cons.
Now you know what to do before applying for a car lease. Enjoy your new car and drive safely!