But I think that extra 50K made a way bigger difference that the extra 0.3% they are asking.
NOTE: There may have been other contributing factors in the 3 weeks between their initial "approval" and me buying the car.
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Ok, not sure if this is anyway related to what you are asking also this info was as per ABSA banker, so I am not sure if this is 100% accurate, but hoping so.
You will have a lower interest rate if you finance the car through the bank yourself than when the car dealer does the finance deal for you, due to the bank having to pay commission to the car dealer.
New cars will usually have a lower interest rate than 2nd hand cars, apparently even if you are looking at the same value.
The higher the amount you borrow the lower the interest rate usually is.
Edit: Your interest rate also depends on your credit rating, so if you have been a bad and not played nice with previous credit given your interest rate will be higher.
Last edited by Dryad; 17-07-2012 at 04:56 PM.
Putting down a larger deposit directly translates to a bigger saving that would be incurred by being granted a lower interest rate purely on the basis of the size of the loan.
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dumb thread Don't you know how to google repayment calculators
R145000k = R145 million. expensive car - must be a collectors items - Ford Sierra in powder blue with torn cloth seats?
Just use an online tool to see what the different variables give you. Try the WesBank one.
Your monthly interest due is recalculated each month (based on what you still owe), at least that's how MFC works. If you drop a lump sum in at a later date, the bank can recalculate your term accordingly.
I got this info from my banker when I bought my car earlier this year:
If you make a deposit, your interest rate could possibly be higher than if you purchase without a deposit (somebody confirmed this above already).
But there is a way around this:
Take out the finance without a deposit, sign the papers, and then make your deposit into the finance account before the first installment comes off. Instruct them to recalculate your repayments, etc. That way your interest rate stays the same as if you purchased without a deposit, but you reduce your actual repayment amount by adding the deposit.
This tip was given to me by my private banker.