Loans differ according to the criteria you are seeking and the facilities offered by the lender. These focus on the loan amount you want to borrow, the type of interest rate, your credit status and any extra features you may require.
To ensure your comparison is comprehensive, it's worth considering the following factors:
Interest rate - If you plan to buy a new car, you may benefit from lower interest rates than if you were to buy a used vehicle. Finding a competitive interest rate is an important part of any car loan comparison, but remember to factor in any fees and features in order to understand the true cost of the loan.
Comparison rate - When choosing your loan provider, you should always check the comparison rate displayed alongside the advertised rate. Any extra fees or charges are included in the comparison rate so you will be able to get a clear picture of the differences between lenders.
Fixed rate vs variable rate - A fixed interest rate can provide certainty, while a variable rate can fluctuate with the market.
Secured vs unsecured loan - Often, secured car loans are cheaper than unsecured ones, because if your loan is secured to your new car and you default on your repayments, the bank has the right to sell the car to recoup outstanding costs. Keep in mind, however, that if you're buying a car that is over a certain number of years old, you may not be eligible for a secured car loan and may need to opt for an unsecured car loan instead.
Loan term - A longer loan term will generally mean lower repayments but more interest payable over the life of the loan. A shorter loan term will likely save you money on interest charges but your repayments will be higher. Choose a loan term that works with your budget.
Fees - Some of the fees you may be charged include application fees, establishment fees, extra repayment fees, early repayment fees and other monthly fees.
Features - There might be certain loan feature that are important to you, such as unlimited extra repayments, a redraw facility, or a balloon payment option. If this is the case, be sure to confirm whether your preferred loan product offers these features.
