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Dealer finance v Credit Union/bank loan??

  • 04-07-2013 10:42pm
    #1
    Bleating Lamb
    Registered Users, Registered Users 2 Posts: 4,803 ✭✭✭


    My sister going buying a second hand car,hasn't huge knowledge base on cars,neither would I,she has budget of around 9k and around 2k of its savings
    She contacted credit union and they expect her to have at least a quarter of value of loan left with them till loan is fully paid off,they offering 6•75% int rate over 3yrs fixed.
    Is it correct with a dealers car finance or a banks you don't need to tie up money like with credit union as collateral??...as long as you are solvent....
    If so she would go with dealers finance even at higher int rate....any advice appreciated.


Comments

  • #2
    bazz26
    Registered Users, Registered Users 2 Posts: 51,363 ✭✭✭✭bazz26


    Finance through a dealer most likely could be a Hire Purchase agreement through a bank rather than a personal loan like the Credit Union.

    Maths part aside, just remember that if she gets into financial difficulty and cannot make the agreed repayments in full, the Credit Union will be a lot more flexible to renegotiate the terms and make the payments more affordable to pay. While your savings may not be secured against a HP agreement the car will be the property of the Finance company until the final payment is made. So both methods have their swings and roundabouts.


  • #3
    Bleating Lamb
    Registered Users, Registered Users 2 Posts: 4,803 ✭✭✭Bleating Lamb


    Thanks,will say that to her.


  • #4
    coolisin
    Registered Users, Registered Users 2 Posts: 1,793 ✭✭✭coolisin


    Id personally go with the credit union.
    Another benefit is being able to pay off a little extra if you want to clear the loan quicker without being punished.

    But the fact they are alot more flexible then a bank or hire purchase agreement from a dealer.


  • #5
    The Real B-man
    Moderators, Society & Culture Moderators Posts: 3,740 Mod ✭✭✭✭The Real B-man


    bazz26 wrote: »
    Finance through a dealer most likely could be a Hire Purchase agreement through a bank rather than a personal loan like the Credit Union.

    Maths part aside, just remember that if she gets into financial difficulty and cannot make the agreed repayments in full, the Credit Union will be a lot more flexible to renegotiate the terms and make the payments more affordable to pay. While your savings may not be secured against a HP agreement the car will be the property of the Finance company until the final payment is made. So both methods have their swings and roundabouts.

    Agreed Credit Union where Great when i was unemployed Reduced my Weekly Payments & With Credit Union you are Saving too while paying off


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