One of the factors that can influence the price of your car loan is the maturity – how long you borrow the money over.
When Marion Hunter has to advise on the maturity of your loan, he recommends that you choose a maturity, which means that there is a connection between the residual debt in the car and the car’s actual value.
“If you drive in a car for a long time, it is that you get less and less for it if you have to sell it because it becomes less worth it. If you have chosen a loan with a very long maturity, you risk getting paid off so little on the loan that the remaining debt on the car loan is higher than the car’s value if you have to sell it, ”says Marion Hunter.
It’s a scenario you should preferably avoid getting in.
“It is, of course, super-unfortunate when four or five years inside the loan goes out to the dealer to buy a new car and then finds that you have come 20,000 kroner back in the old one. Therefore, we say that you must choose a maturity, which means that there is a connection between the remaining debt in the car and the value of the car, ”says Marion Hunter.
He acknowledges that it can be difficult to know how much your car will be worth when the loan is paid off or if you want to sell the car after five years, for example.
“In your performance table for the loan, you can see how much residual debt you have after, for example, five years, and owed you 100,000 at that time, you can look at your car dealer deep in the eye and ask him if he or she thinks that the car will be worth 100,000 kroner in five years, ”says Marion Hunter.
“If not, you might have to pay 200 extra a month in performance, so you’re as confident as you can now, because you don’t actually owe more on the loan than the car is worth,” Marion Hunter says.
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“Make sure they count on the same loan amount on the same maturity and with the same payout, and then when you get the offers, you have to sit down and look at the APR to see where it is cheapest,” says Marion Hunter.
“Once you’ve done that, you control the price, and then you can start looking at the terms. What is it actually for some terms associated with this loan? When should they begin to change interest rates? How can they change the interest rates – as they like or do they follow a frame of reference? Not many customers look at the terms of a loan, but that is a really good idea to do, ”says Marion Hunter.
So several things determine whether a loan is cheap. Most importantly, you find a loan that suits the situation you are in and a car loan that means that you do not suddenly have a larger residual debt than what your car is worth.
You should know these concepts
An unsecured loan where you as a customer are liable for your personal wealth.
A loan with a retention of title, where you pay a minimum of 20 percent in the loan. The ownership of the car is reserved until the registered debt is repaid.
Loan leasing is a security for the lender when an agreement has been concluded between the lender and the borrower without a third party – such as a dealer – being involved in the process.
In order to create a loan with a retention of title, there must be a tripartite relationship. There must be a customer, an intermediary/dealer, and a finance company. When you borrow money directly to a customer who buys a car, this is not a tripartite relationship. Therefore, a retention of title cannot be used to make a mortgage loan, but it actually works in the same way as with retention of title.
Stamp duty/registration fees:
A variable land registration fee to the state, which amounts to DKK 1,660.00 + 1.5 percent of the registered amount.
These are the costs the dealer takes to make the car ready. From April 1, 2018, car dealers must include delivery costs in the total price, so delivery costs are included in the signposted price.
Safety in the car is registered in the car book, which is a national central register. The security of a car will not be deleted until the registered amount has been repaid.
A license, if you have the frame number or registration number of a car, you can see if there should be debt in the car.
Pin, Land Registration and Document Fee:
The foundation costs you pay to either the bank or the finance company.
The registration fee pays you to the state in connection with land registration.
Document fees are typically paid to the dealer.