If you are looking for a car loan, taking the finance broker route is extremely wise. Generally, the market is inundated with lenders who differ in terms of the rates, maximum loan amount and overall service they offer. Not all lenders would match your requirements to a T. You’ll have to do some significant research by spending time and effort to locate the right lenders. When you throw a finance broker into the picture, you put off the research burden considerably. And a lender would usually not view the research part cumbersome because the broker has industry experience and knowledge that doesn’t necessitate research from scratch to determine which lender you should go with.
Panel of Lenders
Finance brokers typically boast of a panel of lenders they choose to do business with. The options denote the likeliness of finalizing a loan deal at a competitive rate is high. Banks usually offer no option. Dealerships, on the other hand, usually have associations with only a few finance firms – some of them you may not even be aware of. A finance broker’s strong connections also mean you can buy your car anywhere you prefer – through a private sale, from a dealership, etc.
Extensive Knowledge of the Loan Industry
As aforementioned, a finance broker has thorough understanding of the individual guidelines of different lenders. And if there are changes in those guidelines, a broker makes sure they remain up-to-date with that change in policy. This unique knowledge helps a broker effectively compare different finance solutions so that you get the most appropriate finance arrangement for your specific requirements.
Your Credit Score is Important
When you apply for a car loan as an individual, you would invariably put in an application with a handful of lenders. When you apply at multiple places, more enquiries get added to your credit report, which lowers your credit score. A broker, on the other hand, tries to minimize the number of enquiries by getting the very first application they put in on your behalf to click.
It’s Not Just About Interest Rates
A lending firm could offer a lower interest rate, but their establishment, monthly maintenance, and early termination fees could be much higher, which could negate the interest money you save. As an individual borrower, you would not be aware of all these things. A broker would be aware of all these variables. Instead of comparing interest rates, compare the actual monthly or weekly repayment options. This would offer you a more accurate comparison as the repayments would comprise various fees and charges.
Best Finance Deals are Almost Certain
A finance broker would always want to help you grab the best deal. Because these brokers are not looking for one-time transactions but a long-term association with all their clients. And getting the most attractive loan terms is the only way they could keep their relationships with their clients intact. They don’t just want you to come back for future car loan assistance but also want you to refer them to your friends and family.