The “Add-Ons” To Your Car Loan You Need To Know About

//The “Add-Ons” To Your Car Loan You Need To Know About

When you’re in the process of purchasing a new car, it’s very easy to get caught up in the idea of an impulse buy – especially with a well-trained salesperson giving you all the motivation you need to say “yes”.

But before you go ahead and sign away, it’s incredibly important that you consider all the add-ons that the salesperson failed to mention. For this reason, it can be so much more beneficial buying your next vehicle through a car finance broker, who can inform you of all the costs involved.

Here are the “add-ons” you should be wary of:

  • Loan protection insurance

This type of insurance may sound attractive because your insurance company will pay your instalments if you fall ill or, in the event of your death. However, this insurance can sometimes be poor value if you don’t choose the right one, which is why it’s important you have expert help.

  • Extended warranties

All cars come with some form of warranty, often only a few years or less. What some salespeople do is offer you an extended warranty. Whilst these can benefit you in the long run, they only become valuable if they offer you equal or more protection than the normal warranty. Moreover, how certain can you be, even in the height of your excitement about the new car, that you are likely to want to keep it beyond the normal warranty date? Or if you’re not covered for issues that you’re likely to face down the track, it’s not worth the additional investment.

  • Shortfall insurance

Often referred to as a “gap cover”, this type of insurance offers you the opportunity to have a back-up in case your car is stolen, is in an accident or is written off. This insurance will cover the remainder of the loan as well as the value of your vehicle. So, on the surface this sounds like a beneficial investment, right? However, we advise you to choose the right gap cover. In fact, your comprehensive insurance may be enough on its own. Think about this one before you sign on the dotted line.

  • Unnecessary ExtrasHas the salesperson offered you a great deal on other add-ons? Say, for example, window tinting, paint and fabric protection, rustproofing and VIN etching (ID numbers marked on your windows). While these sound like they could add extra value, you need to ask yourself whether you genuinely need them. If not, then save your dollars to spend on other, more important things.

It is important that you don’t get caught up in the hype of buying a new car on impulse. You need to factor in all the additional extras, so you don’t end up sending far more than you need to.

If you’re after any expert advice for your next car purchase, feel free to contact us anytime.

Related Tag: Car Loan

2018-04-09T10:18:06+00:00 March 9th, 2018|Car Loan|0 Comments