What to do if the car loan is declined?Uncategorized
To finance a car, there are different possibilities. Most car dealerships like to finance the new car when making a purchase in their company. However, that does not always have to be the cheaper option. Therefore, when buying a car first, the house bank should first be the first point of contact. However, if the car loan declined by the house bank, another solution must be forthcoming.
Car loan rejected – what to do?
If the car loan was rejected by the house bank because of a lack of creditworthiness, then the person concerned has hardly any chances with another bank. However, if it is not the credit rating, then a demand from other banks makes sense. But what can cause a car loan to be rejected?
In most cases, there is already a loan with the bank in question. Depending on the remaining amount, the bank will reject another loan. On the other hand, online banks are more generous with a loan request. In most cases they do not even require a use. It may well be that the house bank refuses a car loan, but the online banks agree.
Financing with the car dealer
The car dealer wants to attract and retain customers. For this reason, they also like to offer a loan for the financing of the car at the same time. Settlement usually takes place via the car dealer’s house bank. If the credit rating is okay, the car loan is not rejected. However, the car buyer should already be aware that he loses a valuable advantage in the financing of the car dealer, the cash payment. Even today, it is still the case that the cash payment of the car is rewarded. The buyer receives additional discounts, which reduce the purchase price. In this way, the car purchase is cheaper. But this only works if the buyer also pays the car in cash. With a loan from the house bank that would be possible. Because so he pays the loan from his house bank at more favorable terms. If financed by the car dealer’s bank, this possibility will of course be eliminated.
Before one rashly decides to finance the car with another bank, the offers of the different banks should be compared. There are often special offers on the Internet for a car loan on favorable terms. These loans are tailor made for a car purchase. The benefits can be felt, for example, in the amount of interest. In part, banks also offer that the buyer may suspend a rate in the year with the payment. This is cheap in the month when the car insurance is due again.
Conclusion: If the house bank has declined a car loan, there are still other ways to auto finance.