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How to get ready for an electric car

How to get ready for an electric car

If you’re looking to buy your first electric vehicle, you might be interested to learn how best to set yourself and your home up ahead of your purchase.

Electric vehicles (EVs) are slowly but surely becoming more accessible in Australia, with 28 models now available for purchase – seven more than in 2019.

According to the Electric Vehicle Council of Australia’s (EVC) State of Electric Vehicles 2020 report, of the 28 models available, 12 are battery electric vehicles (BEVs) and 16 are plug-in hybrid electric vehicles (PHEVs).

The report shows that six new electric vehicles are expected to be on the road by the end of 2021, five of which will be BEVs, and one PHEV.

In an interview with Bloomberg, Volkswagen Group’s chief executive, Herbert Diess, said “the future will be electric in the passenger car world for sure”.

“That’s pretty clear now. This train is moving. It’s gaining speed and getting momentum. We are preparing for this world.”

While choosing an EV that suits your lifestyle and your budget might be the fun part, it’s important to also consider what else you might need to prepare and what your financing options are.

What do I need to prepare for an electric vehicle?

The most obvious difference you’ll notice when trading in a petrol or diesel vehicle for an EV, is that you if you’re low on fuel (or charge, in this case), you can’t simply wait until you spot the next petrol station sign in the distance to “top up”.

EVs require electricity to be recharged, and owners have a few options that they may ultimately alternate between to do so, depending on their situation at the given time.

According to EVC’s State of EVs 2020 report, there is significant private sector investment underway in public EV charging infrastructure in Australia, with 357 fast and ultrafast charging stations at 157 locations now installed across Australia, and many more planned.

Current Australian EV fast charging networks include:

  • Chargefox
  • Evie Networks
  • NRMA
  • Queensland Electric Super Highway
  • RAC Electric Highway
  • Tesla

While the number of rapid charging stations available to the public are increasing (mostly in places of interest such as in shopping centre car parks, hotels and the like), it’s not recommended that you rely on these alone to charge your car.

Most publicly accessible EV charging stations will charge for usage by either requiring users to be members, and/or charging a fee for use. Not to mention they are not as convenient as a home charger.

You can search for public charging station locations in Australia on various websites such as the Transport for NSW website which features an interactive map powered by PlugShare.

Installing a home charging station

The most convenient and logical place to charge your EV is at home, specifically overnight when you generally won’t have any need to use it. It can take significantly longer to recharge an EV with an at-home charger than with a public fast charger, but it will reach full charge overnight.

Installing EV charging infrastructure at home can be fairly straight forward, and you may be able to take out a personal loan to help with the cost if you come up short.

Installing solar panels

While EVs might eliminate the cost of filling up with petrol, they still use electricity to recharge, and increased use of electricity at home will likely mean increased energy bills as well. Unless, of course, your rooftop solar panels are generating it.

Whether you have rooftop solar at home or have been considering having it installed, there are a couple of ways you could use it to help power your EV, including:

  • Charging your vehicle during daylight hours – While less convenient for many, charging your EV during the day while the sun is shining on your rooftop solar could mean using next to no energy from the grid, as long as it is generating the same or more energy than is required.
  • Use battery storage – A home battery storage system can store unused solar power that is generated during the day and can be used to charge your EV at night. Keep in mind, however, that a battery system will be an expense that is additional to solar panels.

If you are yet to install rooftop solar at home or are looking at add to your existing system to make up for the additional energy you may require, you might be interested in learning about your financing options. Some lenders offer green personal loan products specifically designed for the purpose of making energy-efficient upgrades to your home – like installing rooftop solar.

Often, green personal loans have more competitive interest rates than standard personal loans as lenders incentivise borrowers to make environmentally conscious decisions.

Comparing green car loan options

Similarly, many loan providers also offer green car loan products especially for borrowers who intend to buy an EV, including BEVs, PHEVs and hybrid electric vehicles (HEVs). 

Again, this kind of loan product will often have more competitive interest rates available than a standard car loan.

RateCity’s car loan leaderboard ranks the top five green car loans using Real Time Ratings™, a world-first rating system that ranks products as you use the site, making them as up to date as possible.

Buying an electric vehicle can be a significant cost to begin with, so it’s important to ensure you have the means to either cover the cost of the car outright or comfortably afford regular car finance repayments before thinking about taking on additional loans.

For information specific to your individual needs, consider reaching out to a personal finance broker or financial adviser.

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Fact Checked -

This article was reviewed by Personal Finance Editor Mark Bristow before it was published as part of RateCity's Fact Check process.



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Learn more about car loans

What is a car loan?

A car loan, also known as vehicle finance, is money that a consumer borrows with the express purpose of buying a vehicle, such as a car, motorbike, van, truck or campervan. Car loans can be used for both new and used vehicles.

How do you get a car loan?

There are four different ways you can get a car loan. You can go straight to a lender. You can get a finance broker to organise a car loan for you. You can get ‘dealer finance’ – which is when the car dealer organises a car loan for you. Or you can organise your own car loan through a comparison website, like RateCity.

Whichever method you choose, you will need to provide proof of identification, proof of income and proof of savings. So you may be asked for any combination of passport, driver’s licence, bank statements, payslips, tax returns and utility bills. You might also be asked to provide proof of insurance.

What is vehicle finance?

Vehicle finance, also known as a car loan, is money that a consumer borrows with the express purpose of buying a vehicle, such as a car, motorbike, van, truck or campervan. Vehicle finance can be used for both new and used vehicles.

What is dealer finance?

Dealer finance is a car loan organised through a car dealer – as opposed to car loans organised by a finance broker or directly by the lender.

What is a loan-to-value ratio?

The loan-to-value ratio, or LVR, is a percentage that expresses the amount of money owed on the car compared to the value of the car. For example, if you take out a $15,000 loan to buy a $20,000 car, you have a loan-to-value ratio of 75 per cent. Loan-to-value ratios change over time as you pay off your loan and your car depreciates in value. For example, two years later you might now owe $10,000 on your car, which might now be worth $15,000. In that case, although there would still be a $5,000 difference between the size of the outstanding loan and the value of the car, the loan-to-value ratio would now be 67 per cent.

What is a dealership?

A dealership is a car yard or a place where cars are sold.

What is a loan term?

The loan term is the amount of time the lender gives you to repay the car loan. For example, if you take out a $20,000 car loan with a five-year loan term, you would be expected to pay off the entire $20,000 (plus interest) within five years.

Can you refinance a car loan with the same lender?

You may be looking to refinance your car loan to get lower interest rates or reduce the total monthly amount you have to pay. Often, this leads to the question ‘can I refinance a car loan with the same bank?’

While it’s always worth shopping around for a better deal or at least to compare offers from other lenders, you can sometimes refinance to a different loan with the same lender. It may be simpler,  as the lender already has your details and knows your repayment history. 

Having said that, knowing the terms offered by other lenders may help you negotiate a better deal with your current lender.

Should I service my own car?

There are also costs associated with vehicle ownership, such as paying for petrol and the obligatory ongoing maintenance. But should you cut down on costs by servicing your own vehicle?

If you’re considering getting out the tool box, spanner, and grease-laden towel, you need to carefully weigh up the risks and benefits. A trained mechanic will need to complete certain tasks, while you may be perfectly capable to handle other aspects yourself.

If you’re short on time, it may be worth paying for the convenience of a full vehicle service. However if you’re trying to slash your expenses, there are some basic maintenance tasks that you can complete yourself.

You should call a mechanic if you’re unsure about a vehicle maintenance task you’re about to take on. However there are a number of maintenance tasks that you may be able to complete with your own two hands including:

  • Replacing your car battery
  • Changing the oil
  • Replacing worn windscreen wipers
  • Replacing blown fuses

Remember to keep your car’s body in good condition, by washing and applying a protective wax on a regular basis, too.

Always check your car warranty agreement as some new car purchases come with an extended car warranty provided your services are conducted at the vehicle service centre where you purchased the car. In these circumstances, you may find the service fee is capped, alleviating some of the maintenance woes.

How to get a chattel mortgage?

Both businesses and individuals may use a chattel mortgage, provided that the car is being used predominantly for business purposes. 

To apply for a chattel mortgage, you need to first consider your options and choose a suitable lender that meets your requirements. Once you have selected a lender, you can apply for the loan online by filling out a form. If the lender doesn’t offer an online application process, you can either call them or visit their nearest branch. 

After you’ve applied, the lender will ask you to supply documents that confirm your identification, income, job profile, etc. If everything is in order, most lenders will arrange the loan’s settlement, so all you need to do is pick up your car!

Can you get a chattel mortgage with bad credit?

Getting approval for a chattel mortgage with bad credit may be possible, given ‘chattel’ (usually a piece of equipment or car) is put up as security for the loan. That means if you fail to repay the loan, the creditor can recover the loaned amount by repossessing and selling the car or piece of equipment. This differs from unsecured car loans, where the asset is not tied to the loan and cannot be taken if you don’t meet the repayments. 

How to find a great car loan

Historically, finding a great car loan would require excess research ranging from visiting an excess of websites or making phone calls, but technology has moved on. Using RateCity, Australia’s leading financial comparison service, you can check out great deals from a range of lenders on the one site.

To start, select the amount you want to borrow and the length of the loan, narrowing your search to show just fixed or variable interest rate results.

Once you’ve indicated your search criteria, you’ll see an immediate list of lenders, ranked by interest rate or application fees. You’ll also be able to view the monthly repayment amount for each result, helping you to know what you can afford.

Up to six products can be compared side-by-side, complete with more information about each car loan, giving you more information about your options.

When comparing your car loan options, it’s ideal to keep in mind some points find a great car loan for your needs. Consider the following:

  • Choosing a low interest car loan can reduce costs
  • Selecting an option with low fees and charges is ideal, because these can really add up
  • Be aware of penalties, such as early exit penalties if you pay off the loan sooner than expected
  • Consider the features that best suit your situation

There are many ways to ensure that you get a great car loan. Ultimately, you’ll end up with the best deal by doing your research and selecting the most suitable product for you.

Where can I get a student car loan?

Student car loans are not a necessarily a product in and of themselves, but what you may be looking for is a guarantor car loan.

A guarantor car loan has a third-party act as a form of guarantee for your loan application, telling the bank or lender that if you default on your loan, someone will pay the loan repayments.

Going guarantor on a car loan is no new thing, and before internet-based credit scores, guarantor car loan applicants would apply for loans with a guarantor or property owner who could vouch for the person borrowing the loan.

To get a guarantor car loan, you’ll need someone willing to act as a guarantor for your car loan.

What is a guarantor on a car loan?

A guarantor on a car loan is a third party, usually a relative or friend, who guarantees to meet the repayments of a loan for the purchase of a car, if the borrower/owner of the car defaults on the loan.

Guarantor car loans can be useful for people who would otherwise struggle in being accepted for credit to purchase a vehicle. These may include people with bad credit, students and young people who may have no credit history, as well as some pensioners.

Many lenders offer guarantor car loans, guarantor personal loans and guarantor home loans, because of the significantly reduced risk to the lender.

What is a secured car loan?

A secured car loan is a loan that is connected to a form of security, or collateral. Generally, the security for a car loan is the car itself. If you fail to repay the loan, the lender might seize your car, sell it and then use the proceeds to recover their debt.

Can I buy a car as a student?

Buying a car is a huge financial decision, and shy of marriage and purchasing a house (or perhaps around the world travels), it may be the biggest financial decision you make. But if you’re looking at your empty pockets, don’t despair! Your dream of owning your own car could become a reality, if you look for and compare the right car loans for your circumstances.

What is proof of residence?

Before giving you a car loan, lenders will ask for proof of residence – documentary evidence that you live where you claim you live. Lenders will typically want some combination of utility bills, bank statements, mortgage documents or driver’s licence. The reason lenders want proof of residence is to verify your identity and credit history.

What are loan repayments?

Loan repayments are the regular payments you make to pay off your car loan. Loan repayments generally occur on a monthly basis, although many lenders will also give you the option of making fortnightly or weekly loan repayments.

What is the role of a guarantor on a car loan?

The role of a guarantor on a car loan is to meet repayments if the borrower of the loan were to default for any reason, such as not being able to afford it.

Useful for loan applicants with poor or bad credit, a guarantor makes it possible for these loans to be made secure, because there’s less risk for a lender overall.

Companies will likely give fair warning before they charge a guarantor for the costs of the loan, or before they repossess anything of the guarantor’s that may have been used as security. Still, it is important for a car loan guarantor to fully understand their responsibilities before they commit to the transaction.

What is credit history?

Your credit history is a record of the dealings you’ve had with credit providers such as banks, credit card companies, mobile phone companies and internet companies. Your credit history records how successfully you’ve managed your repayments. It also records how many credit applications you’ve made and how many of those were rejected.

Credit providers refer to your credit history when deciding whether or not to extend you credit. Missing repayments is a bad sign; making too many applications or having applications rejected can also be a bad sign.

Credit infringements can remain on your credit history for five years – or seven years for serious infringements.