• January

    20

    2015
  • 1238
  • 0
What’s in an interest rate?

What’s in an interest rate?

The first question that I am asked by someone who’s wanting to purchase a new car, is “What is the interest rate?” Often customers will quote the rate they have been given by the dealership and advise me that they have been referred to me to seek a better deal.

The first thing I tell them is – I can certainly help you out with that, however, you need to find out what the monthly repayments are including ALL fees, that you are being quoted.

You see, interest rates can be deceiving – especially when applying for vehicle finance.

The only true indicator as to whether you are getting a better deal, is by comparing the amount you will be paying per month, inclusive of all fees.

You see, both car yards, and banks have done a very good job with their marketing, for us to all think that it’s all about the interest rate. But there is so much more to it than that. Just see our previous blog post here – https://beefinancesavvy.com.au/car-financing-from-non-car-dealerships/ which explains the relationship between your finance quote from the car yards and the price of the vehicle.

We recently helped three business partners to arrange vehicle finance, as well as giving them pointers on negotiating the price of their new car. They were well across the negotiations for the vehicle price, but were shocked when they realised that my advice was true – the car yard had quoted them a “lower” interest rate” than what I had, yet their repayments through the car yard were higher!

This is because there is a base rate and a delivery rate – you never know which one you are being quoted!

For an accurate picture of the cost of your vehicle finance, contact us at Bee Finance Savvy on 1300 140 554.

 

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