When it is time to change cars and once the model, power and other features have been decided, the next step is to choose the payment method. Currently, in Spain you can do it in 3 different ways: paying the full amount in hand or requesting a loan, either to the financial one of the dealership where you buy the car or to a bank.
Find a lender to finance your new car
Since the majority of people who buy a car cannot pay cash, since it involves disbursing a large amount of money at once, the most chosen method is financing. However, this raises the dilemma of doing so with the bank or with the concessionaire’s own finances.
Both options will make it easier for you to access a car with a price, that if you had to make the payment in hand, it would be quite difficult. Therefore, before choosing one or the other it is best to know the pros and cons of each one, make numbers and once you have everything clear, tell you which one offers you the best conditions.
Variables that influence the final price
As in any other loan, whatever type, you have to know that there are a number of variables that directly affect the total that you will have to pay back and that you have to take into account whenever you seek the financing of a third party to acquire a good.
Once you have them clear, there is no more to make accounts so that you have no doubts about how they will affect the total amount owed.
What is a Nominal Interest Rate (TIN)?
TIN: The Nominal Interest Rate (TIN) reflects the cost of financing, that is, what the bank charges for performing the operation and lending the money.
What is aAnnual Equivalent Rate (APR)?
APR: Annual Equivalent Rate (APR) in addition to the cost of financing, it also has other expenses, such as:
- Commissions: Commissions are included in the APR. These are the expenses that come from the opening, cancellation or study prior to the granting of the loan.
- Related products: In some cases, it is mandatory to hire other products for the bank or financial institution to grant the loan. An example of these products is the default insurance.
- Return term: The return period is also very important, since the shorter the return time, the less interest it will charge.