Rate City

• Car loans up to $150,000
• Low-interest starting from 4.79%
• Repayment up to 7 years

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Rate City - Their loans come with competitive interest rates

Most car loans are secured, meaning that should you be in a position where you are unable to make repayments, the lender can redeem losses by repossessing an asset that belongs to you, normally the car you are buying.

More often than not these loans have lower interest rates, because they represent less risk to the lender, although there are lenders that only offer secured loans for cars that fit certain criteria. Should the vehicle you are thinking of buying is not eligible for a secured loan, there are lenders that offer unsecured car loans, no matter, if it’s a new or used the vehicle, will not be at risk of being repossessed, but there is a possibility that you will have to pay higher car loan rates instead.

Car loans for new cars versus old cars

Whilst you do need to pay a larger amount up front for a brand new car, lenders do tend to consider new cars less of a financial risk than that of a used car since they are of a higher quality and enjoy a higher resale price. So a competitive interest rate may be more enjoyable for a car loan for a new car.

On the other hand, a car loan for a used car might invite a higher interest rate, for the reason that the loan is seen as a greater risk. With that being said, used cars are frequently cheaper than new cars and tend to depreciate at a slower rate, this balances the scales somewhat when it comes to car financing.

Can you pay off your car loan early?

Should you be in a position where you may have extra cash available, you could add the extra money to your car loan. Thru making higher or added repayments, you can get closer to settling your car loan early, and decrease the total sum of interest you need to pay.

Bearing in mind that some lenders do charge extra fees for added payments or settling your car loan earlier than the agreed term in order to make up some of the lost interest. These costs and charges where repayments are scheduled will be inclined to be more common for fixed-rate car loans but you should always check these facts before taking out a car loan.

If you’re thinking of adding extra cash to your car loan the redraw facility is another handy feature to keep your eye out for. Should you find yourself in a bit cash-strapped situation, a redraw facility will allow you to reclaim any extra cash you may have paid into your car loan, this frees up your car financing to cover any unexpected expenses and functions as a quick cash loan.

This flexible option allows you to pay extra towards your car loan with confidence because you will be in a position to have access to these funds again should you really need them. Make sure to check your lender's terms and conditions as there may be restrictions on how the redraw facility can be used.

Do you need a deposit for a car loan?

There are lenders that offer car loans with a high loan-to-value ratio, where a smaller deposit is paid and you borrow a greater percentage of the car’s value. So all is not lost if you have your eye on a particular vehicle but you don’t have enough cash for a full deposit.

You do come across lenders that offer 100 % car loans, where you don’t have to pay a deposit and you are able to borrow the full value of the vehicle. Naturally, these offers do contain a higher interest rate due to the increased risk, first check whether you are able to afford the repayments to determine if a 100 % loan is right for you.

How do you compare loans?

The best car loan would be one that has all the features you are looking for and at the same time one that you have the affordability for. Just keep this in mind when you are making car loan comparisons, to do your calculations with loan sizes and interest rates before you sign on the dotted line.

Once you have compared the car loan offers at Rate City, you should soon be in a position to narrow down your car financing options to the car loans offering terms that are suited to your requirements, in this way you can be confident that the car or personal loan you apply for is as good as the car you buy!