The Best Way to Finance a Car in AustraliaPublished Tuesday, October 26, 2021
Are you thinking of purchasing a new vehicle from a dealership? Then one of the first things you should consider is how you will pay for your car.
Today, there are many ways to finance a car in Australia. Some buyers choose to take out a personal loan, others put the purchase on a credit card, and some even borrow money from friends and family. However, the best way to finance a car in Australia is through a car dealership.
Read on to learn more about financing a car through a dealership, then contact our team at Westside Auto to discover our best car dealer finance options.
What Is Dealership Financing?
When you decide to purchase a vehicle from a car dealership, you can often finance the vehicle through the dealership rather than applying for an auto loan elsewhere. This payment method is known as dealership financing.
Just like with any other loan, the loan process begins with a discussion about how much you can afford to pay each month and a review of your credit score, income, and savings. The dealership will then contact its preferred bank and arrange a car loan for you. In most cases, the dealership will handle all aspects of the loan rather than a bank.
Dealership financing takes all the work out of getting a loan to pay for your new vehicle. Even better, interest rates and monthly payments on loans through car dealerships are often lower than those offered on other personal loans.
Benefits of Financing a Car Through the Dealership
Financing your vehicle through the dealership offers numerous benefits over taking out a personal loan. Here are a few of the primary advantages of dealership financing:
Trying to find a loan on your own can be time-consuming and stressful. First, you’ll need to contact the bank or credit union and fill out a lengthy application. Then, after a few days of processing time, the financial institution will get back to you with its decision about your loan. If that bank denies your application, you’ll have to start the process over.
Financing your vehicle through the dealership is a much simpler, less stressful process. The dealership will handle all the loan applications and processing for you. All you need to do is agree to the loan terms and drive off the lot with your vehicle.
Dealership loans often come with lower vehicle finance rates and more generous loan terms than other financing sources. In fact, dealership loans with interest rates below 1% aren’t uncommon. These low-rate dealership loans can save you a significant amount of money in the long run.
Low Monthly Payments
A lower payment is another advantage that comes hand-in-hand with low-interest rates, but that's not the only reason you'll typically pay less month to month with a dealership loan. Many dealerships utilise a “balloon payment” method, in which borrowers pay a lump sum balloon payment at the end of the loan period.
Balloon loan payments allow you to keep your monthly costs low throughout your financing term. At the end of the period, you can also choose to sell your vehicle and purchase a new one, avoiding the balloon payment altogether.
Most car dealers want you to walk away with a vehicle, so they do everything they can to make financing as affordable as possible. Financing your car through the dealership can allow you to negotiate loan terms and receive a more generous financing offer overall than you could find through a personal lender.
If you’re planning to purchase a new vehicle, you probably want to be able to drive off the lot with your car right away rather than wait days or weeks for a loan application to process. Dealership financing options are typically faster than financing through a bank or credit union. In many cases, you can test-drive a car, purchase it, sign off on the dealer loan, and drive away all in the same visit.
If you’re looking for a Western Australian car dealer that provides generous financing options, look no further than Westside Auto. At Westside Auto, we offer auto financing online with same-day approvals and immediate delivery.
Request a no-obligation quote today to learn how affordable financing a vehicle through Westside Auto can be.