Whenever you need to borrow any amount of money or need financing to purchase a given asset, you should search for the best car financier in town. In New Zealand, there are many car financiers and they are all different. To get the highest quality of service, it is crucial you spend a little bit of time searching for the best financier in the country. Since most of these firms have a strong online presence, it should be easy for you to find the best lender for your needs.
Bad credit car loans NZ residents should know, come with high interest rates and unfavourable terms and conditions. Fortunately, it is possible to find a cheaper car loan. Below are tips to help you:
i) Pay a Big Deposit
If you would like to get a cheap loan, it is recommended you save up for the deposit. While car financiers usually ask for 10-20% deposit, you can get a cheaper bad credit loan if you make a bigger down payment. For instance, you can pay 30% of the purchase price or more as this will give lenders peace of mind, so they can easily lower the rate of interest they charge. Besides, a bigger down payment means that you will borrow less, so you can finish paying for your car earlier.
ii) Provide a Guarantor
What usually forces lenders to charge a high interest rate on bad credit loans is the fact that the borrower has a proven history of default. This means that lenders are exposed to the risk of default. To minimize this risk, borrowers can provide a guarantor for the loan. In case they default, the guarantor should be contacted to step in. This will undoubtedly help to lower the rate of interest charged.
iii) Shop Around
While most lenders are going to charge higher than normal rates of interest, their rates will still vary. That is why it is recommended you shop around to find the most affordable lender in the city. There are also loan brokers who can help you to shop around, so be sure to consult an independent loan broker with a great reputation in the industry.
After acquiring your Bad credit car loans NZ, it is imperative you make your car payments without default. Be sure to set aside at least three car payments to ensure you will have some cushion in case you lose your current job.