How long can I borrow a car loan?
Under normal circumstances, the loan period for buying a car will not be too long, usually around one to three years. For qualified applicants, the longest term will not exceed five years, that is to say, the optional term of loan to buy a car is 1-5 years.
Of course, the loan term is not as long as possible. For loans, under the condition of a certain interest rate, the longer the loan term, the less the monthly repayment and the less the pressure, but the higher the loan interest. On the contrary, the shorter the loan term, the lower the interest, but the higher the monthly repayment, the greater the pressure.
Can I repay the car loan in advance?
Car loan can be repaid in advance, but the prepayment of car loan may involve the problem of liquidated damages. Generally speaking, if the bank repays the car loan less than one year in advance, it needs to pay a penalty of about 2%-5% of the remaining unpaid amount. For those who repay the loan in advance after one year, most banks will be exempted from penalty interest.
The liquidated damages of auto financing company loans will be higher than those of banks. Under normal circumstances, if the repayment time of the auto loan is less than 1 year, the penalty will be charged at the rate of about 8%, and if the auto loan is repaid normally for one year, the penalty will be charged at the rate of about 5%.
The penalty for prepayment of car loan can be found in the loan contract. If you are not clear, you can also call the customer service hotline of the lending institution for consultation.
Generally speaking, if the vehicle price is relatively low, then applying for a car loan can shorten the loan period and effectively save the loan interest; If the vehicle price is relatively high, the amount of loans required will also increase accordingly, and the loan period will also be lengthened to reduce the monthly repayment pressure.