A new car is not cheap, but sometimes it is simply necessary to buy a new one, even if you have no money to spare. But what should you do when the old car is no longer driving and you need a vehicle to cope with everyday life with a distant job and children.
If you then also have a bad Schufa entry, which, as has recently been mentioned and frequently discussed, does not necessarily have anything to do with a lot of debt, then you don’t just get a loan for a new car.
How do you get a loan for a new car?
Many car dealers have an agreement with a bank where you can get a car loan if you want to buy a new car. But what about a bad Schufa, then many banks also refuse such a loan for a car. However, there is the possibility to take out a car loan with guarantors.
In such a case, this means that not only the newly purchased motor vehicle is considered as security for the lender for the time the loan is repaid, but that a surety is also provided. This is because these guarantors guarantee the lender in the guarantee contract that they will pay for the claim themselves if the borrower stops paying their installments.
What does it mean to be a surety?
If you take out a car loan with a guarantor, this means that the guarantor must have good credit. He guarantees the lender with his assets and is liable with his own assets if, for whatever reason, the borrower is no longer able to continue paying the monthly installments for the car loan.
In the case of a car loan with guarantors, the lender will then contact the guarantor with the entire amount due for repayment. The guarantor can then negotiate with the lender about a monthly payment in installments to repay the loan and must then reclaim the amounts paid from the borrower.
Car loan with a guarantor about the dealership
If vehicle buyers apply for a car loan with a guarantee through the car dealership, they receive a very low-interest rate. The car bank lends the vehicle loan particularly cheaply if the buyer chooses a model with unsatisfactory sales figures or a vehicle variant that will soon be replaced.
However, borrowing from the dealer and the car bank only allows a small discount on the list price to be negotiated. Even with used cars, the specific vehicle has an impact on the cost of a car loan. The longer a car is on sale in the dealer’s yard, the more likely the prospect is to get a low-interest car loan with a surety.