When buying a car, many customers are offered finance by the dealer. This is extremely prevalent across both the new and used car market. Some dealers have an arrangement with a finance company or partnership with a finance broker lender similar to Jade Car Loans. Others utilise the finance arrangements of the motor vehicle manufacturer that they represent. To many buyers this scenario may appear as convenient, a 'no brainer' and a real time saver. But is it a cost saver?
We do a deep dive into motor dealers or finance brokers when it comes to choosing your car finance lender.
Role Definition
On the surface or from a one dimensional point of view, both the dealer and finance broker lender like Jade Car Loans may appear to be providing a similar service or role in regard to car loans. That is connecting you with a bank or lender. But that is not the reality. The roles of motor vehicle dealers and car finance brokers are very different.
The dealer essentially refers you to their finance company or they may have application forms for that finance company for you to complete on the spot or they may give their finance company your details to contact you to sort the finance.
The finance broker lender, Jade Car Loans specifically, actually sources you a low business car finance rate from across a large number of lenders and represents you to the lenders.
We’ll go further by highlighting several issues.
Choice of Lender
In most instances, the dealer will only be associated with the one finance company or lender. You don’t have a choice. They have an arrangement with either the manufacturer’s finance arm or a particular company.
Jade on the other hand provides you with a large number of choices by our accreditation with multiple banks and lenders. We don’t limit your choice of lender. We source you the cheapest deal that suits your requirements.
By referring to our Lender Comparison Calculator, you can immediately see the variation in interest rates charged by different banks and lenders. That variation can end up being a significant difference in the total cost of your car loan over the loan term.
In addition, if you have a specific reason for wanting your bank to finance your car, your Jade consultant will be quite happy to handle the negotiations and arrangements with your bank on your behalf.
Loan Terms and Conditions
Some dealers advertise car loans as a ‘from $xx per week’ so customers can easily relate to the interest rate of cost of the finance. That is a great assistance and one that we readily provide with our calculators. Simply enter the data for your car loan into our Lender Comparison Calculator or our Business Car Loan Calculator and you’ll receive a repayment estimate.
Back to the dealer – they could be offering only a standard car loan for about a set number of years of loan term with no option to negotiate. Negotiate with the finance company? Is the motor vehicle dealer ready to do that for you? Probably not. Their role is to refer you to the finance company or recommend their finance company to you, whichever way you want to look at it. Unless the motor vehicle dealer is partnered with a professional finance broker with credentials and capabilities similar to those of Jade Car Loans.
Loan conditions can be currency. The better the loan conditions you can achieve that meet your requirements, essentially the better the loan. Your Jade consultant negotiates with individual lenders to achieve the best business car loan terms and conditions that you prefer.
The Cost of Convenience
The perceived biggest benefit to car buyers of being able to arrange finance at the same time as buying a car is convenience. Let’s face it, not everyone takes out a finance contract regularly. For some car buyers, it may have been several years, back at the time of their last car purchase, since they were involved with the lending scene. Not being up to speed with what’s on offer, it’s not surprising that they may see this offer as convenient.
It’s also convenient for the dealer as they do not want to risk losing you as a customer and the car sale by you leaving to arrange your finances elsewhere. They may also be receiving a commission or some other rebate for referring you. A dollar amount may be built into the cost of your loan.
The reality is if this is a consumer car loan, the dealer’s finance connection must still abide by the consumer credit laws when offering and processing a car loan application. The same processes that Jade and even your bank must follow must be adhered to. So the only time-saving may end up being only the minute or two that it takes you to call Jade.
Jade Car Loans offers a prompt and streamlined car loan process, which we consider more than matches the perceived convenience of signing on the spot.
- Our online calculators and lender comparison tools allow you to generate repayment estimates on your phone even while you’re at the car dealership.
- Our quick quote service can provide you with a car loan quote promptly after sourcing you the cheapest interest rate offer.
- By handling all the negotiations and paperwork for you, we save you time and a lot of hassle.
- Our consultants are highly trained, finance industry professionals with the skills and knowledge to source you a car loan that meets your requirements.
Most importantly, your Jade Car Loans consultant is working for YOU. Our only focus is your best interests. So when it comes to the very important issue of signing up for car finance, it’s in your best interest to set aside perceived convenience and similar benefits and look closely at the offer and know your lender!
To discuss your car finance requirements contact Jade Car Loans at 1300 000 003
DISCLAIMER: INFORMATION, CONTENT, DATA, REFERENCES AND HINTS CONTAINED IN THIS ARTICLE ARE INTENDED PURELY FOR GENERAL INFORMATION AND NO LIABILITY FOR ERRORS OR SIMILAR IS ACCEPTED. THE INFORMATION IS NOT INTENDED TO FORM THE SOLE BASIS FOR FINANCIAL DECISIONS. ANY READER CONSIDERS THAT MAY REQUIRE ADVICE ON THEIR PERSONAL OR BUSINESS FINANCIAL SITUATION, THEY ARE ADVISED TO SEEK THE PROFESSIONAL ASSISTANCE OF A FINANCIAL ADVISOR.
