When you decide to buy a new car and go to the dealership, it is usually customary to accept the financial proposal that the seller offers us; others, instead, choose a bank of trust or a financial institution with which they have already stipulated previous loan contracts, thinking that these are the most immediate and convenient solutions, with the hope that we will be able to snatch an offer or a buying opportunity. Have you ever thought, instead, of the method of assignment of the fifth for the return of the capital? It is not always proposed but it can become a real opportunity ” to almost forget ” to have bought a car.
Car loan: WHAT IS IT AND HOW DOES IT WORK?
Car loan is a form of financing dedicated to buying a car. This type of personal loan is included in the category of specific loans as it is necessary to produce documentation that justifies the purpose of the required liquidity.
The car loan includes two methods of request which include, as mentioned above, the loan application directly to the concessionaire to which one turns for the purchase of the car or the possibility of paying the account to the concessionaire with a capital obtained with the loan from a trusted banking institution. Let’s take a look at the details of the two solutions that will later be compared to the car loan with a fifth sale.
The car loan with the DEALER: WHERE IS SAVINGS?
IN THE CAR LOAN WITH THE DEALER: the capital needed for the car purchase is paid directly by the credit institution to the dealership to pay off the total cost of the car. The bank anticipates the entire amount of the car on behalf of the customer receiving the loan.
THE ADVANTAGE: the advantage of this type of personal loan stipulated with a contracted bank institution is to have greater facilitations in the interest rate: the same holder of the concessionaire acquires proceeds deriving from the number of customers to which he succeeds in selling the financial with which it has an agreement.
The car loan with FINANCIAL OF TRUST: WHERE IS SAVINGS?
IN THE AUTO LOAN WITH TRUST FINANCIAL: in the second case it is possible to refuse the financial choice chosen by the concessionaire and contact a trusted banking institution, with which, perhaps, a loan has already been stipulated previously. Very often, in fact, if you have been a good payer, it is the bank itself that contacts the customer for a loan request.
A COUNCIL: there are numerous phone calls that credit institutions daily direct to their best customers. grasping this proposal is not bad if you plan to buy your new car.
THE ADVANTAGE: by choosing this type of financing you have the possibility of having the liquid sum necessary to pay off the total cost of the car in a single solution and obtain a reduction even in the initial price. Many dealerships are particularly interested in receiving a sum in cash without having to stipulate financing that implies a waiting time in the provision of money and for this reason they offer the best prices to those who pay in cash the asset to be purchased.
The car loan with ASSIGNMENT OF THE FIFTH: HOW DOES IT WORK?
Different is the case in which you choose to request a personal car loan with a fifth assignment. With this method of financing and repayment of the capital, the monthly payment, which must never exceed 1/5 of the net salary, is deducted directly from the salary by the employer: the monthly salary is received net of this withholding without worry about paying postal bills or making bank transfers.
To better understand, a table summarizing the different types and possibilities of car loans and the comparison with the personal car loan with salary transfer is proposed below:
|CAR LOAN||TYPES||LOAN CAR WITH ASSIGNMENT OF THE FIFTH|
LOAN WITH DIRECT DELIVERY OF THE CAPITAL TO THE DEALER
|CAR LOAN WITH DEALER||MONTHLY INSTALLMENT EQUAL TO A MAXIMUM OF 1/5 OF THE SALARY|
|PERSONAL LOAN WITH CAPITAL CUSTOMER DELIVERY THAT PAYS THE PRICE OF THE CAR IN CASH||CAR LOAN WITH INDIVIDUAL PERSONNEL||DEPRECIATION PLAN ON THE BASIS OF THE DELIVERED CAPITAL|
|BALANCE OF THE COST CAR WITH THE LIQUIDITY PROVIDED BY THE FINANCIAL||REFUND PLAN UP TO 10 YEARS|
The car loan WITH ASSIGNMENT OF THE FIFTH: REQUIREMENTS and GUARANTEES
To apply for a car loan, certain requirements and guarantees are necessary to protect the lender of the loan in the event of impossibility of payment. In the type of loan with salary assignment, banks are usually more likely to grant a loan because they are sure of the regular repayment of the capital through the employer, who directly withdraws the sum due from the monthly salary.
Precisely for this reason, at the time of signing a car loan, the stipulation of a life and employment risk insurance policy is requested which protects the beneficiary of the loan in the event of dismissal or termination of the employment contract; protects heirs in the event of premature death of the recipient of the loan. Thanks to these particular guarantees of the assignment of the fifth, the car loan is also granted to all the subjects who have a permanent and fixed- term employment contract.
The car loan WITH ASSIGNMENT OF THE FIFTH: AND IF I HAVE A TIMED CONTRACT?
The personal car loan with salary-backed loan is the financing solution that provides for the concession also to workers with a fixed-term contract, in line with the legislation on access to consumer credit and to the new types of market that otherwise would exclude a good range of subjects with the possibility of obtaining a loan; among other things, the categories with the greatest financial difficulties and which would need them most.
The only side to consider when signing the auto loan with salary transfer is the duration of the employment contract, which must not exceed the duration of the loan: a loan with an amortization plan higher than the coverage of the work contract would mean having a period of return of the uncovered installments and with difficulty in covering the regular repayment of the capital.
THE ADVANTAGE: in both cases described above it is clear that the advantage of this type of loan is the fact that both categories of workers, regardless of the duration of their employment contract, can access this type of credit.
The car loan WITH ASSIGNMENT OF THE FIFTH: AND IF THE SUM IS REQUIRED IS TOO HIGH?
At the time of signing the personal car loan with salary assignment, the amount necessary to purchase the car is also established based on the amount of liquidity available to the borrower; another case could be that in which the beneficiary does NOT have a liquidity and needs the entire capital to cover the total cost of the car. In both cases the fifth assignment can be granted if all the requirements and guarantees are respected.
The only element to be evaluated is the sum requested: the monthly installment must not exceed 1/5 of the net salary, therefore the maximum payable capital must not exceed the proportion of the installments and an amortization plan up to 10 years. In the event that the requested capital is a sum at the limit or that it exceeds the requirements expressed above, it is still possible to obtain the loan with a salary-backed loan but with the request for other forms of loan which make the claim of further guarantees:
- a guarantor or guarantor with a permanent employment contract;
- the bill of exchange as a monthly installment, which constitutes an enforceable title on an asset that is granted as a guarantee in the event of insolvency of the debt.
|LOAN CAR WITH ASSIGNMENT OF THE FIFTH||CAPITAL DELIVERY||CAPITAL and GUARANTEES|
|WITH LIQUID AVAILABLE SUM||RESIDUAL SUM NECESSARY TO COVER THE COST OF THE CAR||INSTALLMENT UP TO 1/5 OF SALARY AND IN PROPORTION TO THE 120 MONTHS OF THE DEPRECIATION PLAN|
|WITHOUT AVAILABLE LIQUID SUM||TOTAL COST OF THE CAR||
OTHER GUARANTEES ARE REQUIRED:
For those wishing to have more information on the possibility of stipulating different loans based on the capital needed for the car purchase, please also consult the detailed article on loan changes.
The car loan WITH ASSIGNMENT OF THE FIFTH: NO PROBLEM FOR PROTESTED!
Requesting a personal car loan with the sale of the fifth is the only solution for those protested or included in the list of bad payers. Banking institutions no longer have confidence in the regular return of capital by this type of entity but with the transfer of the fifth the installment is deducted directly from the salary, paid to the lender by the employer, and there is a further guarantee in the work contract.
FOR NOT USING ILLUSIONS: if the person requesting the personal car loan is not new to banking institutions, or included in the list of bad payers or protests, even if with the fifth transfer method, it is not certain that the request for a second financing (given the failure to pay in the previous one) is accepted.
The car loan WITH ASSIGNMENT OF THE FIFTH: AND IF I AM PENSIONED?
The personal car loan with salary assignment is a feasible solution even for pensioners: the maximum transferable installment is always 1/5 net of monthly salary but this time the sum to be paid to the lender is deducted directly from the pension. The maximum transferable capital provides the same limits and threshold of which we have spoken for the traditional salary fifth, with the only difference that the retired person does not need to take out an insurance risk employment policy – as the condition does not exist – but the exclusive life insurance policy.
To better understand how the type of car loan with salary or pension transfer is convenient and what are the advantages in choosing one of the two solutions:
|LOAN CAR WITH ASSIGNMENT OF THE FIFTH||MONTHLY INSTALLMENT||ADVANTAGES AND FACILITIES|
|ASSIGNMENT OF THE FIFTH SALARY||UP TO 1/5 OF THE SALARY||FIXED INTEREST RATE AND FACILITIES IN THE INITIAL RATE|
|ASSIGNMENT OF THE FIFTH OF THE PENSION||UP TO 1/5 OF THE PENSION||ABSENCE OF SUBSCRIPTION OF THE RISK OF USE POLICY|
The car loan WITH ASSIGNMENT OF THE FIFTH: IS THE EARLY DESTINATION POSSIBLE?
Similar to any other loan, the personal car loan with salary assignment provides for the option of early repayment of the loan by paying the residual capital in a lump sum with the addition of the penalty of early termination of the contract which has a cost not exceeding the 1% of the total amount financed for the purchase of the car.
In the type of car loan with salary assignment, the penalty of early repayment is the compensation to the lender of the loan for interest expense not taken during the residual amortization period. But there is no need to worry, as the sum to be paid in addition is very low: with a residual capital of 5,000 USD, the maximum amount to be paid is 50 USD.
The installment in the car loan WITH ASSIGNMENT OF THE FIFTH: EXAMPLES
The following are examples of monthly installments with the transfer of the fifth in personal car loans with the maximum amount payable. With this type of loan it is possible to obtain a monthly payment of up to 1/5 of the salary so that even the liquidable amount that can be financed follows these limits.
To better understand, observe the following table (remember that the examples are indicated by a general estimate on the web and are created to give a general idea of the loan and the installments that one must expect stipulating this type of loan):
|LOAN CAR WITH ASSIGNMENT OF THE FIFTH||DELIVERED CAPITAL||MONTHLY DEDICATED RATE||AMORTIZATION SCHEDULE|
|REMUNERATION OF 1,500 USD TO THE NET||10,000 USD||300 USD||5 YEARS|
|MAXIMUM MONTHLY INSTALLMENT = 300 USD||REDUCTION OF THE REFUND PLAN IF LIQUIDITY IS AVAILABLE|
|DEPRECIATION PLAN UP TO 120 MONTHS||20,000 USD||300 USD||10 YEARS|
|DELIVERED CAPITAL + LIQUID SUM||REDUCTION OF THE REFUND PLAN IF LIQUIDITY IS AVAILABLE|