Best way to finance a vehicle

Choosing to buy a vehicle is no simple decision. It’s one of the most significant investments you can make, so you must factor in the best purchasing options available for yourself. From buying it outright to using financing services such as vehicle leasing or applying for a loan, there are multiple avenues you may choose to help you with your purchase decision.

Even if you can purchase a vehicle outright, you may still want to consider its running costs and cost of insurance and decide on a vehicle leasing option that can reduce your financial burden.
If you choose to go down this route, you should be aware of the different vehicle financing options present.

Listed here are some of the best ways you can finance your next vehicle purchase:

1. Get a car with a personal loan

Signing up for a personal loan from a bank or a finance company would be one of the options. Based on the establishment you go for, you’d be entitled to a repayment period of one to ten years. Be mindful of the interest rates on offer as they would vary among different establishments.

The Relax Personal Loan facility offered by HNB FINANCE offers some of the best interest rates in the market, and it is one of the fastest options to meet your financial needs if you’re a salaried employee. You may obtain a loan up to 12 million LKR against a mortgage with a maximum repayment period of 5 years.

2. Sign up for a specialized vehicle loaning service

The Auto Loan scheme offered by HNB FINANCE is geared to provide financial services for customers with vehicle purchasing needs. It enables customers to obtain a loan for vehicle purchases with minimum documents and doorstep assistance at the lowest interest rates in the market.

With the Auto Loan service, you are able to enjoy discounted vehicle insurance premiums and personalized monthly rentals calculated based on your monthly income. Additionally, a repayment period of up to seven years is on offer for both registered and unregistered vehicles.

3. Lease your vehicle

Leasing is another option available for financing your vehicle. This option allows you to secure your loan against the vehicle itself; therefore, you will own the car only after completing your payments.

Our General Leasing services are a must if you plan to own a vehicle or upgrade to a new one. Enjoy a hassle-free leasing experience requiring minimum documentation, specialized doorstep assistance and personalized one-day services with HNB FINANCE.

Finance tips for those looking to lease vehicles:

1. Keep a shorter loan term to make it more affordable

While a shorter loan term leads to higher monthly repayments, this is better for you in the long run as you will be paying less on interest. While it can be tempting to stretch out your repayment plan over the most extended payment period to make it more affordable, this is not a wise choice for an asset that’s depreciating in value, like a vehicle.

2. Large down payment

While it is possible to lease or loan your vehicle’s total expense, putting down the largest down payment if you’re able to afford it can reduce your burden in the long run. This also means you can pay off your loans at the earliest or fully own your vehicle sooner if you opt for vehicle leasing.

3. Consult a financing expert before finalizing your purchase decision

By speaking with the financing company initially, you can understand better the different options available to you based on your own vehicle needs and repayment capacity. Consult with your lending service and assess your standing for a car loan or lease to make the best possible decision.

Obtaining pre-approval of your loan or lease agreement can speed up your vehicle buying process and ensure you receive the best deal possible.

4. Set up automatic instalment payments

It would be a good idea to set up automatic payments via your credit card or direct account transfers to avoid missing a monthly payment that’s due on your vehicle lease or loan. This will not only make it more convenient for you but will also help to maintain a healthy CRIB status and avoid you being burdened with extra interest additions.