A car loan for the self-employed, is that possible? That’s fine. Although self-employed do not belong to the favorite target group of the banks, because their income is uncertain, rather one sees there officials or employees of large enterprises as customers.
But self-employed people depend on loans, be it to compensate for income fluctuations or to invest. And a vehicle is indispensable for many. Fortunately, several banks offer a car loan for the self-employed on favorable terms. With the purchase also tax aspects are important.
Retirees who receive a fixed amount of money every month.
The financial institutions have significantly reduced their lending to economically independent persons since the beginning of the millennium (red line, January 2000 = 100). This is mainly due to fewer loans from major banks (black). Savings banks and credit cooperatives (blue), however, lent more money, the cooperatives alone even spent around 23 percent more money in April 2015, the savings banks about 5 percent than 15 years earlier. Other banks also issued fewer loans, including, for example, regional banks or subsidiaries of foreign credit institutions.
This is reflected in the interest rates. In principle, some banks do not grant loans to the self-employed, including, unfortunately, Nuraybank. But there are also financial institutions such as netbank or barclaycard, which offer special products for freelancers and the self-employed.
These credit institutions offer a special self-employment loan:
- netbank (for freelancers only)
Above all, the savings banks and the cooperative banks give a lot of money to the self-employed. The cooperative group also includes the classic easyCredit. It does not include subsidiaries of foreign credit unions such as Camibank or Loanieplus.
Some banks, have no special self-employed products, but they can still get loans. Employment status, however, is included in the calculation of creditworthiness and thus interest rates. Entrepreneurs also have good opportunities with credit platforms.
Tip: Alternatively, a loan can also be taken together with a partner, especially, of course, the wife or husband. This not only extends the supply of donors, but also lowers interest rates.
Car can be used as collateral.
Because the vehicle serves the bank as security. A car loan for the self-employed thus works much like a home loan, the interest can not be paid it comes to foreclosure and from the proceeds of the remaining debt is paid off. As long as the installments are paid on time, however, the vehicle can be used as normal, the owner only has to deposit the vehicle registration document (Part II of the registration certificate) as collateral. That distinguishes the car loan from the car mortgage.
Because the car serves as collateral, the interest rates are lower than the normal installment loan. However, not as low as a real estate loan, because a car can be stolen or damaged or lose value in any other way.
Loan computer also to play through different situations.
Do I get a lower interest rate if I raise some equity or does that make any difference?
In so-called 3-way financing, one part is financed by equity, another by current repayments and a third by a final installment. The final installment is due at the end of the planned usage and is often paid from the sales proceeds of the vehicle.
While saving is not as attractive today as it was on this 1960s ad, some asset Photo: Press picture of Metabank
The model has the advantage that the rates can be significantly lower. As a rule, they are at least as high as the depreciation plus the accrued interest, otherwise the last installment could not be paid from the sales proceeds and the bank runs the risk of having to write off part of the loan.
Usually, the banks carefully calculate the residual value in order to play it safe. Even in the interest of the debtor, the remaining debt should be well below the sales value at the end of the term, otherwise there is no equity for the purchase of the next vehicle. Ideally, there is even more money left over than was initially invested in equity for the car so that long-term wealth is built up.
In addition, a high final installment is more expensive overall. Because the interest is always calculated on the remaining debt, a lower repayment also means a higher total burden. This can be seen clearly in the example of a car loan of 22,000 USD with an interest rate of 5.1 percent.
In the case of the loan with the final installment, significantly more interest is paid in total than if the loan had been repaid by the end of the term.
Example : A car loan was concluded for 22,000 USD with an interest rate of 5.1 percent. At a rate of 520 USD in the first month around 430 USD are paid. Because the interest charge decreases from month to month, the repayment increases until at the end almost the entire rate flows into the repayment. After four years, the loan is paid off, with a total of around 2,250 USD interest being paid.
At a rate of 300 USD at the beginning only about 210 USD are paid. After four years, the remaining debt is still around 11,200 USD. The loan has already been paid around 3,300 USD interest. If the loan is to be fully repaid at the same rate, it must be extended by about three years.
Comparison calculator. If you set up a hierarchy according to importance, you get this order:
- Low interest rates.
- Possibility for special payments.
- Permanent change of rates.
Credit bureau information. However, the self-employed person does not have to obtain this himself, but with the loan application he gives the financial institution the right to ask the Credit bureau for the relevant data.
Finally, as with employees or pensioners, the identity must be confirmed. This is either via a PostIdent or, increasingly, via video legitimacy.
Maxcredit and Monocred also a car loan for the self-employed without Credit bureau, which are mostly loans from foreign banks. In principle, reputable companies make a free and non-binding offer. Under no circumstances should interested parties pay a commission in advance.No w to the online loan calculator and find the cheapest loan! X