Key Mistakes to Avoid for Car Financing in Pakistan

car financing

If you are in the position where you need to purchase a new car, you will instantly realize that you have to find the finance to pay for it. Not many people will have the cash in their bank to pay for it and so, an alternative form of finance will need to be identified. This is where car loan can be an effective form of finance for a car purchase in Pakistan. This article illustrates the key mistakes to be avoided whey you plan to apply for car financing in Pakistan.

 

The best car financing in Pakistan can be found by carrying out a comparison. The process is simple and effective and it can help you to find the right finance. However, you should proceed with an element of caution when applying for a car loan because failing to understand one simple aspect can lead to problems.  This could be a simple oversight or even a lack of care but it could create a new financial burden that could cause problems for you in the future. Therefore, you need to understand the potential problems and avoid them. This will enable you to make the right decisions from the very start. The following section highlights those key mistakes that you should avoid if you are a prospective applicant for car financing.

 

Inability to Meet Repayments

If you are looking to take out a car loan and car financing in Pakistan then it is important to understand that Pakistan banks require you to have the ability to meet the repayments each month. Failure to meet these payments can lead to further problems so you need to make sure that you borrow an amount that you can comfortably afford to repay.

 

Applying to Multiple Lenders for Car Financing

If you opt to approach too many lenders your credit history could become a problem. This is because your credit report is affected each time you make a request and therefore, the score reduces. Making a request in a short period of time makes you look like you are frantically looking for finance and could lead to banks in Pakistan offering you a higher rate. Therefore, comparing loans with Mawazna.com will provide you with a good visibility of the best rates being offered by the main banks in Pakistan. Some of the examples are as follows:

– HBL car loan

– Bank alfalah car loan

– MCB car loan

– UBL car loan

– JS Bank car loan

– Bank Alhabib car loan

And many others on the list.

 

Not Being the Honest

All lenders will need to know each and every detail about you from a financial perspective. Inform them of all loans and other financial commitments that you may have in place as the amount you can borrow is driven by all of this information. Failing to provide this information is only going to lead to an increase in interest rates and loan rejection.

 

Additional Reading: Money Saving Tips When Getting a Car Loan in Pakistan

 

Failing to Check Your Credit Report

Whether your loan is accepted or not depends on your credit report and credit history maintained by banks. Prior to applying for a loan, you should check the score. This will enable you to make the right changes to improve your score. It is also important to consider the score before you apply. If it is already low and loan rejection is possible, your score will become even lower.

 

Ignoring to Maintain Your Credit History

From the young age, start building your credit history. A good credit score will always help you to get your loan applications approved by Pakistani banks. If you are maintaining your credit history with care, you are in fact securing your financial future. This is because, in the near future, your ability to get loans easily will depend upon your credit history. Hence you will be able to get loans easily including your car loans.

 

Not Understanding the Small Prints

The small print may be small to read on your application forms but it is not insignificant. Therefore, you need to fully understand what the terms and conditions of the loan are. The agreement will contain vital information such as charges and rates that you need to be aware of. If you fail to understand these, you could be hit with charges in the future that are not planned.

 

Failing to Compare Car Financing Options

If you want the very best rate and the lowest repayments, you need to compare loans. This kind of research will provide you with the right information that will help you to make the correct decision. This means you need to compare interest rates, repayments and any charges that the different banks charge. Using a comparison service such as Mawazna.com will ensure that you are up to speed with the different car loans available to you.

 

Mawazna.com is a growing financial services comparison platform in Pakistan that enables consumers to make more informed decisions when choosing financial products and services including health, car and travel insurance comparison, selection and buying an insurance policy offered by leading insurance companies of Pakistan. Visit us online to compare banking (all loan products and car financing), insurance (car insurance, travel insurance, and health insurance) and broadband products to make more informed decisions.

 

“Mawazna Karein Apne Liye, Apno key Liye”

Author: Team Mawazna

Team Mawazna

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