Home Rack How to buy a car from a dealer on credit. How to take out a loan to buy a car

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How to buy a car from a dealer on credit. How to take out a loan to buy a car

Advertisements for buying a car in installments can be seen in any newspaper. The simplicity of getting a car loan hides many pitfalls. In order not to overpay interest on the loan, you should understand the nuances of lending.

Nowadays, in almost any newspaper you can find advertisements offering to purchase a car in installments - “It’s easy”, “Car loan in half an hour”, “Beneficial loans for the purchase of a car”, etc.

But behind all the apparent simplicity of obtaining a car loan, at the stages of selecting and applying for it, many pitfalls await you. In order not to get into trouble and not to overpay extra interest on the loan in the future, let’s look together at all the nuances of purchasing a car on credit. First, remember - the bank will never operate at a loss, so advertisements like “Interest-free car loan” should not be completely trusted. Surely, the provider of this service included the missing interest in the account servicing commission, an inflated interest rate, etc.

But let's start in order. So, you want to buy a car on credit. The first step is to choose a credit institution and the most profitable loan option that will suit you in all respects.

Choosing a car loan

Car loans can be divided into loans issued at places of sale of cars, i.e. in car dealerships and loans issued directly from the banks themselves. Applying for a loan through a car dealership is much easier than obtaining a loan from a bank.

Firstly, you save time - the decision to issue or refuse a loan, in most cases, comes within a day at most. And most often, within one or two hours. At the bank, your application and documents are processed on average for three days, and the registration process itself can take a week.

Secondly, car dealerships cooperate with several banks at the same time. This allows you to choose the most suitable loan option for yourself. And thirdly, to apply for a car loan directly at the dealership, much fewer documents are required.

Here is a list of the main documents and requirements that are necessary to apply for a car loan at the bank itself and at the car dealership itself.

Documentation

Documents required to apply for a car loan at a bank:

Statement
Borrower questionnaire
Passport (with local registration)
Driver's license (some banks also require a minimum driving experience - at least one year)
Certificate of salary (required minimum work experience in the last place of at least six months)
Original or certified copy of work record book
A copy of the agreement with the car dealership
Original or certified copy of the vehicle passport (if you have already selected a specific car)
Other documents at the discretion of the bank (each bank has its own list of them)

Documents required to apply for a car loan at a car dealership:

Statement
Borrower questionnaire
Passport
License (many car dealerships do not require a minimum driving experience, i.e., after receiving your license, you can purchase a car on credit. Of course, if you meet all the other parameters of a reliable borrower)

As you can see, the difference between the number of documents is significant. Moreover, these days, when most of the salary is issued in an envelope, it is very problematic to provide a certificate of real salary. By the way, in addition to a salary certificate, you can provide the bank with documents confirming your ownership of private property - a house, apartment, garage, etc.

The minimum age at which a working-age citizen can obtain a car loan is 18-23 years old, depending on the bank. But in practice, it turns out that loans are taken mainly by people aged 23 to 50 years. If you are officially married, then most banks will also require your spouse’s notarized consent to receive a loan.

Your total family income should be 60-70% more than the monthly loan payment. Most banks require that you pay part of the cost of the car yourself. As a rule, this amount is 10-20%. If you take out a car loan without a down payment, then be prepared for a higher interest rate.

But taking out a loan through a car dealership also has its downsides. The main thing is a higher interest rate on the loan. If when applying for a car loan through a bank it is approximately 9-12%, then when applying through a car dealership the rate will be at least 15%. And often its level reaches 20-25%, and this is a serious reason to think about where it is better to apply for a loan. There is also a restriction on the year of manufacture of the car you buy. In most cases, banks rarely give loans for cars earlier than 1997. This problem is partially solved by car dealerships - some do not have a strict restriction on the year of manufacture of the car you choose.

Car loan terms range from 6 months to 5 years. But the longer the terms, the higher the interest rate on the loan. The currencies in which you can get a car loan are different – dollar, euro, ruble. At the same time, the interest rate will vary depending on the type of currency. For example, a loan in dollars will be 4-8% less than the same amount in rubles.

Applying for a car loan

Let's say you have decided on the type of car loan and the bank issuing it. Now it's time to complete the paperwork. Read each clause of the contract very carefully. If possible, ask a lawyer you know to help you understand the details of the contract, or hire an independent third-party specialist.

In any case, a properly executed contract is not worth the money you will spend on qualified advice. Pay special attention to how much it will cost you to issue a loan, a one-time payment for opening a loan account, and a monthly fee for maintaining a loan account. Sometimes the amounts of these points are clearly inflated. For example, in some banks the one-time payment for opening a loan account is up to 5% of the loan amount. What if you buy a car that costs $30,000? Do the math for yourself.

Since the essence of the car loan agreement is that the purchased car itself is collateral for the loan, it becomes your property, but becomes collateral with the bank until you pay off the entire amount of the loan. For this purpose, the bank retains the PTS. Moreover, at the time of purchase, a title is still issued to you, but only so that you can register the car. After 10 days, you must provide the PTS back to the bank. For each day you are overdue, you will be subject to a fine.

In addition, another condition for obtaining a car loan may be mandatory. Thus, the bank provides itself with an additional guarantee in case your car is stolen or damaged in an accident. The insured amount is 7-10% of the market value of the car. Moreover, you will need to insure your car CASCO for the entire term of the loan agreement with the bank.

Loan payments

After completing all the documents, you receive your copy of the agreement and the monthly loan payment schedule. Now you must, in accordance with this schedule, deposit the required amount into your loan account every month no later than the date specified in the documents. Some banks allow you to transfer funds by postal order, but there is an additional fee for this service, which the post office charges.

For late loan payments, the bank charges penalty interest. This is either a fixed amount of several hundred rubles, or 0.5-4% for each late payment day. Most banks do not allow early repayment of loan payments, because this way they lose their additional profit. Therefore, banks also impose penalties for early payments. But in some banks it is still possible to pay off the loan early after a certain period has passed, usually 12 months.

Example of car loan payments

We apply for a loan at the Moscow car dealership through a local bank for a period of three years. The cost of a car in luxury configuration is 220,000 rubles. We take out a loan in rubles. The loan rate is 17% per annum. When purchasing a car, we immediately pay 20% of the total cost of the car - 44,000 rubles. The amount we borrow is 176,000 rubles. Bank commission for opening a loan account – 3,600 rubles one-time; The bank's monthly commission for maintaining a loan account is 0.4% per month; Loan repayment – monthly in equal installments; Loan collateral – collateral for the purchased car

According to statistics, every fourth resident of the Russian Federation owns his own car. It is easy to calculate that three-quarters of our compatriots do not yet have a car. Do they have a chance to switch from public transport to private transport? You can buy a car using favorable car loans from banks.

What is a car loan? This is money borrowed from a bank to buy a new or used car. Due to the fact that the purchased car is the collateral, the buyer has the opportunity to buy a car even without a down payment. When weighing the need to apply for a car loan, you need to take into account not only the cost of the car, but also:

annual interest;
loan repayment period;
commissions for bank services;
fines for possible late payments.

If you bought it, you can use it personally, but you cannot sell, change or give it away without the bank’s permission. Loan programs are issued both in banks and in car dealerships. During the entire period of repayment of the debt, the car registration certificate will be kept in the bank. The usual requirements for the borrower:

working age (21–60 years);
citizenship of the Russian Federation;
registration in the region where the bank is located;
length of work at the last place of at least 3-6 months and income;
guaranteeing timely payment of monthly payments.

1. Car loan: pros and cons.

Car loans have a number of advantages. Among them:

buying a car in a short time with little or no savings (the main requirement is sufficient monthly income);
preferential conditions. The state encourages the population to purchase domestically produced vehicles and those assembled in Russia. At the same time, a certain part of the interest on the loan is compensated to the owner of the new car from the state budget;
long payment period - from a year to 5 and even 7 years.

But you can’t do without minuses. The disadvantages of a car loan are:

strict requirements for borrowers;
the risk of losing the purchased car, since it is the vehicle that guarantees the repayment of the debt;
presence of obligation: most banks require the client to purchase a CASCO policy, which is why costs may increase by about 10-15%;
the initial contribution amount is from 10 to 30% of the cost of the car;
in the absence of a client contribution, the interest rate on a car loan increases significantly;

The procedure for applying for a car loan takes from several days to two to three weeks. Express loans have a higher interest rate. You can apply for it in just a couple of hours, but the annual loan rate of 29% is not affordable for everyone.

Thus, a car loan is a good tool for purchasing a car. Only the potential buyer should be sure that his income will be enough to pay off the debt. Due to the instability of the financial situation, an increasing number of people who want to acquire their own vehicle are taking out car leasing. This is a long-term car rental with an option to purchase.

2.: pros and cons.

This service is currently provided by leasing companies and banks. To apply for leasing you will need:

passport;
certificate from place of work;
driver's license;
down payment – 10–45% of the cost of the car.

The no-fee service requires the collection of a more extensive package of documents. Typically, a car is leased for a period of one to 5 years. The leasing company buys the car and remains its owner until the end of the contract. The client uses the vehicle on the basis of a general power of attorney. In this case, you will need to purchase a CASCO insurance policy. The leasing company is responsible for registering the car with the traffic police and conducting technical inspections.

Upon expiration of the lease period, the client has several options:

pay the remaining cost of the car and become its full owner;
return the car to the leasing company;
renew contract;
draw up a new contract for another car.

The undoubted advantage of car leasing is that it can be issued to those to whom the bank has refused to issue a car loan. In this case, the client will not have to provide collateral or a guarantor. In all likelihood, such car purchase schemes will become quite popular in the near future.

For a number of reasons, a bank loan may not be issued. This includes the economic crisis, the borrower’s insufficient income, and his lack of collateral. In this situation, leasing a car is the best solution, and you can arrange it in just a few hours. In addition, banks are increasing interest rates on car loans, while rates in leasing companies remain unchanged: 11-14% in dollars and 18-20% in national currency.

When leasing a car, you will not have to immediately pay a large amount for its registration and insurance. 3% tax to the pension fund, 8% property insurance, payments to MREO, technical inspection and transport fees are evenly distributed over the entire payment period. You will only need to pay the state fee for notarization of the contract - 1% of the cost of the car and the commission of the leasing company/bank.

The undoubted advantage of leasing is the absence of penalties for late payments and the provision of free additional services by companies such as ordering a tow truck or partial payment for a hotel room.

For the sake of objectivity, it is worth mentioning the disadvantages of leasing. For example, leasing companies may limit the ability to modernize a car or require the use of a certain service center.

3. Deposit programs.

Another alternative to car loans is to save up money for a car yourself. For those who do not like to live in debt and are wary of unforeseen situations, the safest way is to save money. To speed up this process, you can use the ones offered by banks and credit organizations.

If you take out a deposit with a good annual rate and monthly capitalization of interest, then in a couple of years you can save up a sufficient amount for a car. At the same time, you will not have to overpay interest on loans and incur high costs for car insurance.

It is difficult for an inexperienced consumer to delve into the intricacies of bank loan programs. To understand this issue, you can compare a car loan and a consumer loan issued for a three-year period.

For example, the client’s goal is to buy a new car worth 500,000 rubles, and 200,000 rubles. for the down payment he already has. Thus, you need to borrow 300,000 rubles from the bank. In order to obtain a consumer loan, you do not need to report to the bank for its purpose, but you will have to prove your solvency.

Since the average monthly payment will be about 10,000 rubles, the borrower’s salary must be at least 30,000 rubles. Otherwise, the bank will require a guarantor or collateral. If you can find a loan at 10% per annum, the total overpayment will reach RUR 48,529.70.

A car loan is a targeted loan, the payment of which is secured by the car itself. Banks offer two lending options: with and without government subsidies. When buying a car assembled in the Russian Federation, you can get a benefit - a reduced interest rate (5.5-12% per annum). In this case, the overpayment will be about 32,136.84 rubles, and for a car loan without government support - 38,465.90 rubles. Figures show that a car loan is more profitable than a regular bank loan.

Which car loan is more profitable: in foreign or domestic currency?

Having decided to buy a car on credit, you need to choose the currency prudently. What is more profitable - a foreign currency or ruble loan? Banking experts recommend applying for a loan in the currency in which it will be more convenient to pay. You should focus on the banknotes with which you receive wages or other income. This will reduce the risks of currency exchange rate fluctuations and save on conversion.

Currently, interest rates on loans in national currency are higher than in dollars due to the depreciation of the ruble against the American currency. It is more profitable to take a short-term loan in dollars, and a long-term loan in rubles. When the economic situation is quite stable, a car loan in foreign currency is more profitable, since interest rates on it are usually lower than on ruble loans.

How to get a profitable car loan: instructions

To paraphrase a well-known saying, the fish are looking for where it is deeper, and the buyer is looking for a car loan, where it is more profitable. You can apply for a car loan at a car dealership or at a bank. Of course, it is more convenient to conclude an agreement on the spot. But often sellers offer a limited choice of banks with which they cooperate, and the cost of a loan can be quite high. It is much more profitable to choose the appropriate option using car loan calculators common on the Internet.

To make a wise purchase of a car on credit, you need to take a number of actions:

Determine the object of lending. For the purchase of a new car, the interest rate is slightly lower, but its cost is higher. A used one costs less, but the interest rate is higher.
Decide on the loan size.
Calculate the allowable monthly payment. You can use a loan calculator.
Negotiate with guarantors and agree on loan terms with them.
Study the market situation by choosing 5–6 most attractive programs. This must be done taking into account the interest rate, additional payments and expenses (application consideration, appraisal, insurance, bank commission for providing a loan, etc.)
Compare the terms of loan programs: term, overpayment, repayment methods, etc.
Collect documents. As a rule, to obtain a car loan, the following list of documents is required: an application in the bank’s form; passport of a citizen of the Russian Federation; certificate 2-NDFL (issued by the employer’s accounting department); photocopy of the work book; driver's license (if available).
Submit an application to the preferred banks (in a branch or on the website). If you receive several positive solutions, you can choose the most suitable one.
Get a loan decision.
Pick up a car. Of course, you can do this in advance, but only after a positive decision is made will you know the loan amount, the bank’s requirements for the car and the procedure for repaying the debt.
Sign an agreement with the bank, making sure that all the conditions are clear and transparent to you.

Important criteria when choosing a profitable loan:

When receiving money on credit, the client will need additional amounts to purchase insurance and pay all commissions. Based on this, you need to clearly define your financial capabilities.

Which banks offer the most profitable car loans?*

Since a car loan is issued for several years, it is safer to cooperate with a stable, proven financial institution. Loan terms may vary depending on the region. As for the capital, several banks are currently offering favorable conditions for car loans.

Here are some of the most profitable car loan programs. When determining them, we took into account the low interest rate, an acceptable down payment, the absence of hidden fees and loyal requirements for the client.

Moskommertsbank offers to buy a new car with compulsory life insurance at an interest rate of 10.5–13.5% and a down payment of 10%.
With the “Standard” car loan, Cetelem Bank gives you the opportunity to buy a foreign-made car with a down payment of 15%, at a rate of 10.9–19.5%.
The rate on the Primsotsbank “Prestige” car loan is 11–15.5%, and the down payment starts from 15%.
Europlan Bank also offers good conditions: the rate when buying a new car will be 11.4–18%, the down payment will be from 10%.

It is worth discussing another new “pitfall” of lending - zero car loan. For example, in the USA, a potential client is offered two ways to buy a car on credit:

or at its market value with further interest payments,
or at a price that already includes bank interest.

Thus, the buyer has a choice: to spend the bulk of the money immediately or later.

In the UK, banks are generally not allowed to lure borrowers with interest-free loans. Most car dealerships attract customers using this marketing ploy. But this foreign innovation is being proposed in a Russian manner. Common sense should dictate that a bank simply cannot afford to set a zero interest rate on loans issued, because it is not a charitable organization. Therefore, you should expect that interest is already built into the price of the car.

How does this scheme work? For example, a dealer may offer to issue a loan to purchase more expensive versions of this brand, assuring that there are no cheaper ones left. To open a credit account, the client will pay not $100, but one and a half to two times more. Subsequently, it turns out that he will have to pay monthly interest to service this loan (0.2 - 0.5%).

There are often situations when a bank tries to hide its interest. For example, it establishes the obligation for clients to pay a one-time fee of 3% of the total cost of the loan or to pay periodic monthly fees of up to 1.2% of the initial loan amount. Simple calculations will show that in this situation the bank will earn not just the standard rate of about 14.4% per annum, but 18-20%. Where does this amount come from?

When taking out a standard car loan, the annual interest rate is charged only on the outstanding loan amount. This amount, of course, decreases annually. But the monthly commission is a constant amount, which remains unchanged throughout the entire period. Therefore, strange as it may sound, only rich people can afford a “zero loan”.

For those who are turning to lending for the first time, the question of how to get a car loan seems complicated and scary. Maybe because of the amount, maybe because of the responsibility for repaying the loan, etc. For others who have already used a consumer loan, it will not be difficult. In the case of a car loan, the bank has more guarantees of repayment than when issuing a loan for a tablet, since there will be .

The main and, perhaps, main obstacle to obtaining a car loan is a bad credit history. But even this moment can be corrected, it just takes time and.

How to get a car loan

If you decide to take out a car loan from a bank and do not have one, then the procedure for obtaining one comes down to a simple sequence of actions:

Preparation of documents and application for a car loan,
Receiving a decision with the approved car loan amount,
, execution of a purchase and sale agreement, making a down payment,
Concluding a car loan agreement with a bank,
Registration and collateral,
Payment by the bank for the car to the dealer's account,
Receipt and registration of the car.

Listed, in principle, are the typical steps for obtaining a car loan. In individual cases, additional points may arise.

For example, the requirement to insure the life and health of the future car owner.

Also, some differences may be present when purchasing on credit between and.

How to get the required amount on a car loan

For those borrowers who do not have savings and want to borrow, the amount they can count on plays a big role. The amount of this amount will, first of all, determine which brand of car to choose at a car dealership based on price.

In addition, reviews from knowledgeable people can help you choose not only the bank where to get a car loan, but also choose the optimal model:

Most
Prestigious, etc.

It would be a good idea to find out the credit car, and most importantly, the prices for maintenance. Information regarding the availability of spare parts and consumables for a particular car model will also be useful.

“Man invented credit in order to live tomorrow today,” said one of the famous economists, emphasizing the importance of this financial transaction for those segments of the population who, for certain reasons, are not able to buy any goods for cash. The most successful loan transactions include loans for the purchase of cars, and this trend has continued for decades. Including in Russia, where a boom in car lending was observed in the pre-crisis years of 2006–2008. But even in the post-crisis years, this type of vehicle purchase was very popular among Russians: according to statistics, in 2013, every second new car was purchased on credit (this, in particular, was facilitated by the preferential lending program). Today we will talk about how to buy a car on credit correctly.

First, let's look at the statistics again. In 2014, according to the United Credit Bureau of the Russian Federation, the number of people wishing to purchase a car with funds from financial institutions sharply declined: in the first quarter, 16 percent fewer car loans were issued than in the same period in 2013, and in the second - by 26 percent. percent. Nevertheless, as financiers say, most people coming to Russian car dealerships are interested in the conditions for buying a car on credit. And in most cases, people buy a car this way. Let's say that you don't have enough money to buy a car in cash, and you're thinking about a loan. Let's take a closer look at the process of purchasing a car on credit and its pitfalls.

Step 1. Selecting a bank and loan program.

Let's say you have already decided on a certain make and model of car and decided which package you will take. All that's left to do is pay for the chosen car. You don’t have enough money, you ask the manager at the dealership about the possibility of buying a car on credit. And then a lot of information is poured into your ears about special offers, about interest-free loans, about protected loans - in general, your head is spinning. Naturally, in such a state it is impossible to make such a responsible decision. Take all the calculations for each offer from the manager and go home, where in a calm atmosphere, weigh all the pros and cons of the methods of buying a car proposed to you.

Every car enthusiast who decides to take out a car on credit can choose two ways to borrow: take money from the bank where he receives his salary, or use the services of the bank(s) that the car dealership offers him. The advantages of the first option - your “home” bank can offer a loan on more lenient terms (for example, reducing the rate by 1.0 percent), the monthly payment can be debited from your salary card (no need to go to the branch, stand in line there, monitor the loan repayment terms) . And also - require a minimum package of documents, provide “credit holidays” on loyal terms, and give permission for a loan within a couple of hours. The disadvantages are that you will have to do all other operations (insurance, etc.) yourself. And the bank will have strict control over compliance with the loan agreement.

The advantages of the second option are participation in an affiliate program (Nissan Finance, Renault Finance, Citroen Finance, etc.), where the car dealership offers special conditions for lending (at reduced rates) and insurance (reduced rates for CASCO and CASCO), paperwork at the dealership, quick acceptance decisions on issuing a loan (within 1 day). The negative aspects of this method of lending are that the buyer for a certain period (from a year and for the entire loan term) can be tied to one insurance company (sometimes the one owned by the dealer), whose CASCO rates may be higher than those not included in affiliate program of car dealerships, insurance and banks, insurance companies. Therefore, before making a choice between these two lending options, you need to evaluate all the pros and cons.

Now let's look at the loan programs offered by banks and car dealerships.

An interest-free loan is a very interesting and tempting thing, but with its own characteristics. To apply for such a loan, you must have at least 50% of the cost of the car - this amount will be the down payment. The second feature is the term of the interest-free loan. Typically, such a loan is issued for a year, in extreme cases – for two years. The monthly payment for this type of loan is lower than for a conventional loan, and this is because most of the cost of the car has already been paid by the buyer. In addition, in such programs the client has no choice regarding the loan repayment system - only debt repayment is provided in equal payments (annuity). When drawing up a contract, you must carefully read the rights and obligations of the parties. In some agreements, the bank provides for such a “penalty” as the transfer of an interest-free loan to an interest-bearing one for a delay in payment of 1 day.

An express loan is an opportunity to take out a loan to buy a car in a few hours. This is where its advantages end. And then there are only disadvantages. Firstly, the loan amount is limited to one million rubles (regular loans are issued in the amount of up to five million rubles), and secondly, the down payment for an express loan is 20% of the cost of the car. Thirdly, a high interest rate of 17-20% per annum (for a conventional loan, depending on the term - up to 16% per annum) and mandatory, without which the interest rate may exceed 20% per annum.

A loan without a certificate of income and a down payment is, at first glance, a tasty loan option, which, despite its visible advantages, is fraught with obvious disadvantages in the form of high interest rates (from 20 to 25% per annum) and severe penalties (high penalties in case of delay for repayment of debt for a loan).

Special lending programs - car dealers use them with all their might, attracting buyers with loyal rates (from 4.9 to 7.9% per annum in rubles). Such programs are promotions, their validity is usually limited to a month, and their goal is to sell the remaining cars in the dealer’s warehouse. Therefore, the selection of models and trim levels participating in such a program may be limited. Another unpleasant point is the amount of the down payment. The fact is that a pleasant interest rate is given only if the down payment is at least 30% of the cost of the car and the validity period is only a year. If you want to take out a loan for a period of 2 to 5 years: no question, there is a contribution of 10%, but the interest rate is no longer 4.9%, but 10.9 to 14.9%.

Step 2. Assess your own capabilities and collect documents.

First, answer yourself: can you afford to allocate a certain part of your income to repay the loan. On average, for a car costing over 500,000 rubles, the monthly payment to the bank is about 13,000 – 20,000 rubles. If the answer is yes, then we move on and determine whether you can make a down payment, which is 10% of the cost of the car. Can you? Great. Next, we calculate that to the down payment you will need to add a deposit for the car (given to the manager of the car dealership, this is a guarantee that you are really going to buy this car), as well as the costs of issuing CASCO and MTPL policies. Let’s say you buy a Nissan Juke car for 650,000 rubles, the deposit for which at the car dealership was 30,000 rubles, and CASCO and OSAGO – 60,000 rubles. The down payment at the creditor bank is 15%, which will amount to 98,000 rubles. As a result, you will have to have about 190,000 rubles in cash on hand. We’ll also add the salon’s service for registering a car with the traffic police MREO and producing license plates - 15,000 rubles. Total – 205,000 rubles. Do you have that amount? If yes, then we prepare the money and collect the documents necessary to open a credit line.

The following documents are usually submitted to the bank:

Borrower's questionnaire (issued at the bank);

Passport;

A second document confirming the identity of the borrower (or a foreign passport);

Certificate of employment regarding income for the last six months;

Car purchase and sale agreement (taken from the car dealership);

Payment document from the car dealership to pay for the purchased car;

A copy of the vehicle passport (PTS);

CASCO insurance policy with a receipt for payment of the insurance premium;

MTPL insurance policy with a receipt for payment of the insurance premium;

Payment document confirming payment of the down payment (bank receipt).

If you have a guarantor, then he will need a passport and a certificate from his place of work about income, on the basis of which the bank will be convinced that the guarantor will be able to insure you if something happens and repay the loan debt.

Step 3. Execution of a loan agreement.

Perhaps no less important step than the first two. During the loan application process, many nuances may arise that the borrower did not foresee. For example, the fact that some banks charge a commission for processing a loan application. Or they provide for penalties for any seemingly insignificant things. For example, if the borrower changed his phone number, changed his place of residence, moved to another job, did not bring the car to the bank branch for reconciliation within the agreed time frame, please pay 1% of the loan agreement amount.

You should also take into account that when applying for a car loan, you are the owner of the car, and the mortgagee is the bank. And in addition to the loan agreement, you will have to draw up a pledge agreement, which must be certified by a notary. Naturally, this operation is not free and it is better to find out its prices in advance.

Read the loan agreement carefully to find out if the bank charges a fee for early repayment of the loan. Most Russian banks have abandoned this measure, but there are exceptions. It would be a good idea to find out about the possibility of refinancing a loan and transferring it from one currency to another. After all, it may happen that you begin to feel burdened by a loan taken in foreign currency, you are no longer satisfied with the terms of the loan, and you simply want to change your car before the loan expires. If the bank provides such opportunities, then ask under what conditions and what is needed for this.

In general, before you sign the agreement, find out all the possible sanctions that the credit institution may apply to you. And only after understanding all the positive and negative aspects can you conclude an agreement.

In order to apply for a loan from a bank, you need to decide approximately how much you want to borrow. This can be the full cost of the car or, if you have money for a down payment, part of it. Based on your solvency, the bank will name the amount for which it is ready to lend you.

Typically, the procedure for applying for a car loan consists of the following steps:

Submit documents to the bank

To obtain a loan from a bank, you will need the following set of documents: passport, driver’s license, application form (issued by a bank employee), a copy of your work record book and a 2-NDFL income certificate (can be obtained from the accounting department at work).

Sometimes the bank may require you to provide a TIN certificate and a copy of your spouse’s passport. If you are not officially married, then a copy of your common-law spouse’s passport will do. There is a subjective factor here: banks trust clients with families and children more, and less trust in those who do not create a “unit of society” and do not strive to have children.

An application for a car loan is a questionnaire in the form of a bank. It is filled out either at the institution’s office or on its website. Essentially, this is background information about the client. But very often the refusal to issue a loan is due to its incorrect filling. In the application form, you should indicate as much reliable information about yourself as possible. You should not overstate or understate your income, hide your credit history or any biographical facts, or attribute to yourself property that you do not own. All specified data can be easily verified by the bank.

Some banks offer clients an express loan. Its peculiarity is the fast procedure for reviewing the application and issuing money. If you choose this option, then you need to provide only three documents: a passport, a driver’s license and a completed bank application. You will have to pay for speed with a high interest rate.

Wait for the results of the bank check

Verification of your documents can last from several minutes (if it is an express loan) to several days. It often combines analysis by a scoring system (a special program for determining solvency) and examination of documents directly by a credit expert.

If the bank has made a positive decision on your loan application, then you have from 26 to 180 days (depending on the institution) to finally decide on the choice of car and apply for a loan for its purchase.

If your solvency seems insufficient to the bank, it will offer to find co-borrowers or guarantors. They will answer with their wallet if you have financial difficulties.

Conclude an agreement with the seller

A car purchase and sale agreement is concluded with the seller, which will indicate the deadline for completing documents and paying for the loan.

Make a down payment

If you choose a car loan with a down payment, then you need to deposit money into the seller’s account. This can be 10-50% of the cost of the car. If you buy a car without a down payment, then this step is excluded.

Conclude an agreement with the insurer

The list of insurance companies you can contact is often limited by the bank. These institutions carefully select partners to avoid additional risks of losing their money. However, you should clearly understand that insurance is a service, and no one has the right to force you to buy it. Here the choice is yours: follow the bank’s lead or insist on your right to choose the insurer that is beneficial to you.

On the other hand, do not forget that you can get a car loan without purchasing insurance. In this case, you will have to pay the bank a higher interest rate.

Conclude agreements with the bank

car dealership payment document;
a copy of the car's passport;
insurance policy (if required);
document confirming payment of the down payment (if provided);
if you are married, then the consent of the husband/wife to receive a loan and transfer the car to the bank as collateral.

After this, the bank transfers the loan amount to the seller’s account. This procedure may take several days - its duration is indicated in the contract.