How does Car Financing Work?

If you dream of buying a Jeep from a dealer but don’t know where to start, you’re in good company. This year has already seen a boom in car sales, with car loans up 4.7% according to ABS data.

The good news: securing finance for your dream car isn’t as daunting as it might sound. When you chat to a Caroline Springs Jeep expert and break down the process into practical steps, you’ll see it can actually be swift and straightforward with the support of the right team.

In fact, in most cases, our customers discover they’re much closer to achieving their car ownership goals than they initially think.

What is car financing?

In simplest terms, car financing is the process by which a customer secures a loan to buy a car.

Whether it’s for family road trips, the daily commute, or keeping your business on the move, for many of us, our daily routines would be unimaginable without a car. Did you know that 92.5% of Australian households have a car? That’s a lot of drivers on the road, and it follows that most of these drivers will, at some point in their lives, aspire to buy their own car. With our everyday vehicles playing such a key role in our lifestyles, it makes sense to invest in a car that you love and can rely on.

However, while so many Australians do hope to one day purchase their very own car, up-front and running costs can be prohibitive. If you don’t have the savings sitting in the bank to buy a car today, that’s where car finance comes in. Even if you think your current financial position makes buying a car beyond your reach, applying for a car loan could be an ideal solution for you.

How does it work?

When you take out a car loan, you borrow a sum of money from a financial institution like a bank or other lender to finance your purchase. Naturally, this amount will vary depending on your financial situation, the car in question, and your income/capacity to meet repayments.

Over a certain amount of time – generally three to five years – you repay the full purchase price in monthly installments with an agreed-upon interest rate to that financial institution. Interest rates will also be assessed on a case-by-case basis, taking into account your financials and income sources.

To get the ball rolling, simply fill out a finance enquiry form and a Caroline Springs Jeep team member will walk you through the process. While online loan calculator tools can give you an idea of what to expect, it’s always more helpful to talk to a real person about your options. 

What will the interest rate look like?

When it comes to the amount of interest on your car loan, there’s no definitive one-size-fits-all solution, because every individual’s unique financial profile will influence this figure.

Generally speaking, if the bank/lender deems the loan to be risky (perhaps you have a poor credit history or unstable income) your interest rate will be higher than average. However, if you can prove you have access to stable income, can fund a deposit yourself, and have a relatively clean financial record, this will all work in your favour when the interest rate is calculated.

Why does Caroline Springs Jeep partner with Ausloans?

Information overload? We totally get it! Car finance can be a lot to take in, which is why we’re taking the guesswork out of the process for our customers – while simultaneously striving to achieve best-value, lowest-rate outcomes for them.

That’s why we’ve partnered with Ausloans. As Australia’s leading finance provider, the Ausloans team is committed to tailoring a nuanced, best-fit financial solution to your unique circumstances and goals. Ausloans works with more than 40 lenders, so the team has access to a vast array of financial products, so they leave no stone unturned when hunting down the perfect car loan for you.

 Best of all? Ausloans doesn’t work for the big banks, so you can rest assured that there’s no hidden agenda here. In fact, the team’s only agenda is to deliver top-tier customer service, so you’re armed with the information you need to feel confident about making such a milestone purchase.

It’s the easy, practical way to hit the road sooner in a car you love – and that otherwise would have been out of your price range.