Car Finance

[George]

Hi all,

I'm helping a friend get finance to buy a VW Polo. They've been offered an interest rate of 5.88% APR which I didn't think sounded too bad, is this about the standard rate?

The car is for sale at a private dealer, but I'm not sure who the finance company is

Thanks

[Beddie]

It's not 'that' bad a rate for car finance imo , yeah you could get a personal loan for 4.9% but that would depend on circumstances and amount borrowed so I'd be happy with that rate from a smaller dealer 
More importantly I'd double check that the 5.88% offered is definitely the APR rate and not flat rate, some dealers when asked what the % interest rate is have been known to quote flat rate which is a lot different in real percentage terms to APR, Seat main dealer did exactly that to my cousin a few weeks back so definitely check on that point...

[George]

Thanks Beddie 

[Bazgti]

It's not 'that' bad a rate for car finance imo , yeah you could get a personal loan for 4.9% but that would depend on circumstances and amount borrowed so I'd be happy with that rate from a smaller dealer 
More importantly I'd double check that the 5.88% offered is definitely the APR rate and not flat rate, some dealers when asked what the % interest rate is have been known to quote flat rate which is a lot different in real percentage terms to APR, Seat main dealer did exactly that to my cousin a few weeks back so definitely check on that point...

What beddie says.... Flat rate is usually half of an APR. So if it's 5.88 flat it's essentially 12% APR. Has he been quoted a payment? I can tell by that which it is if you know.

[Stevepd]

Don't forget to negotiate on the rate they do have room for manoeuvre or get the admin fee paid. Many buyers fail to ask as it's not common knowledge.