Best Car Finance Deals

Best Car Finance Deals

People want the best car finance deals from their auto loan providers when it’s time to take out a loan for a new car.

Whatever the reason, you need a car – and fast. Vehicle finance deals make the acquisition much easier, but be cautious when approaching a car finance loan. Here are some things to look out for when searching for the best car finance deals.

What are the advantages of getting a car loan?

Depending on the car loan options, there are several advantages offered to you as a borrower that you might not get through cash payments.

One benefit is convenience. Saving up for a large purchase is always the best practice when it comes to finances, but taking out a loan is a reliable financing resource that’s been tested time and again. Because automobile financing is one of the more popular loan types, there is also a wealth of choices where credit providers and lending platforms are concerned.

Another benefit is freedom of choice. Dealership financing may offer a much more attractive loan product, but their car loan financing is typically only for newer cars or for selected models. If your desired vehicle isn’t part of the offers available for car credit, you may have to settle for a different vehicle that doesn’t meet your needs as well as your first choice.

Finance car loans also give you negotiating power. Since you’ll be paying for the vehicle in full using your loaned amount, you could negotiate a much better price or for lower attached charges. If you’re buying a collectible vehicle, it could also mean that you have a better chance of getting the vehicle than any other interested buyers.

Are car loans fixed or variable?

Before getting into the advantages of fixed and variable interest rates for car credit, let’s break them both down first. What determines variable or fixed interest rates in the best car finance deals?

Variable interest changes value with the economy

Variable interest for current car loan rates is based on a prime rate, which is a nationally standardised benchmark set by the federal bank. In Australia's case, the Reserve Bank of Australia (RBA) determines this benchmark, which banks then use as a starting point when they calculate variable interest rates for loan offers.

Understanding the prime rate is important when you’re offered a variable interest in the best car finance deals because if the prime rate rises, so does your loan rate.

For example, if the present prime rate set by the RBA is 2% and your bank offers you car loan financing with a ‘prime rate plus 2%’ variable interest, your loan’s final interest rate will be 4%.

While the best value car loan with only 4% interest sounds tempting, consider this: if the prime rate goes up, your loan’s interest rate will go up as well. Prime rates tend to increase for many volatile reasons, such as inflation, economic stress, or political turmoil; they also change daily, and your lender may calculate based on their unique metrics.

The 4% variable interest rate on your automobile financing today may become 7% next month, or 3% next month, depending on the current prime rate.

Fixed interest stays the same for your entire loan

Fixed rates are more familiar to many borrowers looking for the best car finance deals. Most loans have fixed interest rates for convenience; the rate doesn’t change even if the principal loan amount is adjusted through advance payments. One method of calculating fixed interest on small personal loans is to find the per cent rate equivalent based on the principal loan amount, the result of which is then divided by the loan term.

Automobile financing with a principal amount of $5,000 at a 10% monthly interest rate, for example, will result in a total of $5,500 owed. For a loan term of 36 months, the monthly repayment would be $152.78, not accounting for any additional charges like monthly fees or late penalties.

SocietyOne offers fixed interest rates on all of our loan products and at lower rates compared to major financing and loan banks. We also don’t require any early repayment or monthly fees – what you see in your loan agreement is what you repay based on your repayment schedule.

How do I find the best interest rates for a car loan?

Finding the best car finance deals can be as easy as downloading the SocietyOne mobile app and sending in an application.

As one of the leading finance and loan companies, SocietyOne’s secured and unsecured loans are some of the best car finance deals in the lending market. Our product offers have been recognised by Canstar and Australian Financial Review (AFR) for product excellence since 2012. With a quick application process that only takes minutes and a fast loan disbursement of at least one business day, SocietyOne takes credit potential to the next level.

Our unsecured personal loans have a minimum loanable amount of $5,000 and a maximum of $50,000. Available loan terms come in flexible two-, three-, and five-year lengths, and the better your credit score, the better the loan rates we can offer. Green loans and holiday loans are examples of unsecured loans.

For secured loans, the loan floor is also $5,000, but with an adjusted ceiling of $70,000 and an additional seven-year option to the existing choices. For collateral, the assets should meet a minimum market value based on the desired loan amount. Personal loans with guarantor requirements and loan consolidation financing are examples of secured loans.

Get your credit score in order with SocietyOne

If you’re worried that your credit score is keeping you from getting the best car finance deals, you can check your credit score on our platform and track its progress as often as you need to. We’ve partnered with Experian, an official credit reporting agency in Australia, to provide you with insights into your credit history. Just register for a SocietyOne account through our website or mobile app and click the ‘Get My Score’ button on the Credit Score page.

We have a Credit Score Club, which is a free service we offer to our current clients and interested borrowers. Through the club, members can access powerful credit management insights and resources.

Because the club is obligation-free, interested users don’t need to have ongoing personal online loans or applications with us to sign up.

SocietyOne strives to provide excellent credit products to our loyal customers, from loan repayment to consumer lending investments. So kickstart your credit to better credit opportunities – check your rate and apply for a personal loan with us today!