Buying a new car? Want to make sure you get the best deal to suit your needs? If so, a car finance broker could be the solution.
Car finance lending is at an all-time high, increasing to $1.4 billion by October 2023 (according to data from the ABS). This isn’t surprising considering how car prices have gone up post-COVID. But it means more people than ever are now searching for competitive car loans.
So, where should you go for car financing?
What is a Car Finance Broker?
A car finance broker is someone who can act as a middleman between a borrower and a lender. They’ll analyse your current financial situation, compare loan options from different lenders, negotiate for the best terms and help you with the paperwork.
The best thing about using a broker to apply for a car loan is that you know they’re working for you, not for the lender (or the car dealership!).
What Are the Advantages of Using a Broker for Car Loans?
Applying for car loans through a broker brings definite advantages, such as:
- Better Range: Brokers have established relationships with a panel of lenders, giving you access to a wider range of loans. This makes it easier to find a competitive loan that suits your needs.
- Expert Guidance: A broker provides expert advice tailored to your individual circumstances. They can help you understand complex loan terms and conditions so you can make an informed decision.
- Saving Time: A broker will take care of everything, including the paperwork, negotiations and follow-up communication with the lender. This will save you a lot of time and effort.
- Great Deals: Brokers negotiate directly with lenders to get the best possible rates and terms. They can do this because they have expert knowledge of the industry and pre-existing relationships with the lenders.
- Customised Solutions: When you use a broker for car financing, you won’t end up stuck with a “one-size-fits-all” loan. Instead, a broker can help you find a loan that meets your needs, whether that’s flexible repayment options, a longer loan term or a lower interest rate.
What Are the Disadvantages of Using a Broker for Car Financing?
There are some potential downsides to using a broker for your car loan, including:
Some brokers may charge an upfront fee for their services. To make sure you’re not paying more than necessary, look for a broker who won’t charge any added fees.
When using a broker, you’ll have to rely on them to manage the application and approval process. This means relinquishing some control so that they can liaise directly with the lender.
Many car dealerships will promote finance that allows you to drive away on the same day. Using a broker generally involves a few extra steps, so it can take longer for your finance to be approved.
Tips for Getting the Best Car Finance Deal
What can help you get the best finance deal for your needs? Try these simple tips:
- Improve Your Credit Score: A higher credit score can lead to better loan offers with lower interest rates.
- Set a Budget: Create a detailed budget to see how much you can comfortably afford to spend on a car loan payment each month.
- Get Pre-Approval: Loan pre-approval will help to establish your final budget and strengthen your negotiating power.
- Research: Do some basic research before meeting with a broker. This will help you have more meaningful discussions and make informed decisions.
Talk to A Car Finance Broker at Professional Lending Solutions
Can you trust a car dealership or a bank to put your best interests ahead of their own? Probably not. But brokers are legally obligated to always work in your best interests. So, you can have total peace of mind that you’re getting the best deal to suit you.
Ready to hit the road in your brand-new car? Book an appointment with our experienced car finance brokers at Professional Lending Solutions today.
Phil’s journey from banking to mortgage brokering reflects a career driven by a commitment to personalised service and tailored financial solutions. With a distinguished background in banking, including roles at NAB, ANZ and Lloyds TSB Bank in the UK, Phil spent 12 years developing expertise in personal and commercial finance, while also completing a Bachelor of Business (Finance), followed by an MBA majoring in International Business.