Car finance. It seems like a viable option, but do they have your best interests at heart?
Fortunately for you, there’s an alternative. An affordable and ethical alternative that puts you in the driver’s seat and helps you feel in control of your money.
A credit union loan does not offer Representative APR
You may have come across the term APR on your search to find the right finance option for you. But, in case you didn’t know APR stands for ‘annual percentage rate’ which is essentially the amount of interest that is added to the amount you borrowed.
Now, what exactly is ‘Representative APR’?
Representative APR looks at the lowest APR that a lender offers to 51% of people who are accepted. For example, if you see a loan advertised for 16% Representative APR – it means that 51% of people who are accepted get the loan for that rate.
The other 49% are charged a higher APR. This means 49% of people will pay more interest.
No need to worry though as your local credit union only shows the exact APR… what you see is what you get!
You can check out our free loan calculator that works out how much you’ll pay if you’re accepted.
You don’t need to buy through a dealer
Instead of being tied to one dealer, you get the opportunity to shop around and find a deal that’s right for you. Once you know the car you want, you can use a loan to cover the exact costs.
Own the car as soon as you purchase it
Want to own your car when you buy it? Well, with a credit union loan you can do exactly that. A loan can help buy a car outright. No strings attached.
Purchasing a car on finance means you’ll need to pay the total amount before the car is yours. You may need to be extra careful too because missed payments could lead to repossession.
You should also note that since the car isn’t yours, you don’t have the right to sell it as the lender is the legal owner. Whereas using a loan to buy your car outright gives you greater control of your finances in the future.
No balloon payments
Some car finance options require a balloon payment at the end of the loan agreement. This is a lump sum that’s often larger than your monthly repayments. With this comes more risk because you need to factor in your agreed monthly payments as well as a big payment at the end of your loan.
With a credit union car loan, there are no balloon payments. You pay the agreed amount each month and if you want to pay more to bring your balance down – you can… at no extra cost.
Pay extra, pay less interest
As we said, you can make extra payments with no fees attached. In fact, with additional payments, you pay less interest!
We have no fees or hidden charges with our loans. We pride ourselves in being open, transparent and fair.
Our interest is charged on the reducing balance. This means, if you can afford to pay extra, you’ll pay less interest. It’s that simple.