Vehicle finance is booming in Germany
Research shows again and again that most Germans take out a loan on the ground to finance the purchase of a car. In the meantime, it is more than every third new and used car that the corresponding buyers do not pay entirely out of their own resources. Not only the installment loan or the car loan from the bank is gladly used, but also dealer financing, for example. Current figures from the banking association show that this trend will continue in 2016.
Vehicle finance increases by an average of 4.6%
Current figures from the banking association show that motor vehicle financing continues to be popular with many consumers, which of course can also be attributed to the low interest on loans. This leads to the result that from January to June 2016, on average 4.6% more financing was used than in the same period of the previous year, i.e. from January to June 2015. Another trend is particularly evident in the fact that consumers are no longer just happy to finance new cars with a loan, but that there is an increased interest in financing, particularly for used cars. The financing ratio for the financing of new cars rose by 4.1% in the first half of 2016, while there was an increase of around 5.0% in used car financing.
Increased car financing is also strengthening the business area of the banks
Despite the low interest rates, it is of course also the case with the increased demand for motor vehicle financing that this strengthens the corresponding business area of the banks. For some years now, more and more credit institutions have been offering very special car loans for customers. This means that not only the global installment loan is available for vehicle financing, but also special car loans, some of which have special properties. The car dealers are moving in this direction, so that here too, installment financing is increasingly being used. The following three financing models are available to car buyers via the dealer:
• Classic installment financing
• Three-way financing (balloon financing)
• Vehicle leasing
For the customer, there are numerous financing options that can be availed both when buying a new car and when buying a used car. Ultimately, the car buyer primarily has the task of comparing the different offers and ultimately using the financing option, which is the best solution for him. Whether in individual cases this is financing through the dealer, the car loan from the bank or even vehicle leasing depends above all on the requirements and the individual situation of the loan seeker. The trend is definitely towards comprehensive car financing, because more and more used cars are being financed through a loan or an agreement with the dealer. The high number of changes in ownership of used cars certainly contributes to this, which is primarily due to the reduced useful life of used cars.