Faced with the economic crisis that strikes Brazil, a lot of people have their bills tight. If your financial life has reached an uncontrollable level, then it is time for caution and planning.
If you want to find a quick and less expensive solution to your pocket, car refinancing is worth it in certain circumstances, especially for you to avoid high interest rates like credit card or overdraft.
However, care must be taken not to get lost in the finances for good. To assist you in solving your financial problems, we have prepared this post with important details on the topic.
What is car refinancing?
Whether paid in full or not, your vehicle can be reassessed by lenders and banks. After a review, the full amount is released as a deposit loan to your account. From then on, new installments – up to 60 – will be generated, with interest rates ranging from 2.12% to 3.47% per month, varying according to the year and the percentage financed in relation to market value. of the vehicle.
Personal and car documents are required for refinancing to be released. When seeking this credit, it is necessary to make a careful planning, as late payment of installments may represent the loss of the asset.
Is car refinancing worth it?
When deciding on refinancing, the guideline is to observe the market value of the vehicle using the Fipe table. See if the price is right and represents a sizable percentage of the money you need. It is usually possible to get up to 80% of the car price.
Also be aware of the number and cost of installments. Will you be able to take on them?
If your car is well maintained and priced, it will certainly be a good deal. Another tip is to use refinancing to lower interest rates and installment values, helping to boost your finances.
If debts are at high levels, especially with credit cards and overdraft, refinancing can be useful and more advantageous as it has lower interest rates.
It is also suitable for those who need quick cash in urgent situations, such as family illnesses or repaying arrears of various accounts, in order to reorganize the family budget.
What are the basic cautions when choosing refinancing?
In addition to all the analysis so that you don’t get into even more debt after getting the vehicle refinance loan, it takes a lot of discipline not to get lost in the accounts again.
The first tip is to use the money released in what was actually planned, ie, not to let temptation speak louder. Make a spreadsheet with accounts payable and receivable, appropriately targeting your budget.
If your car is not fully settled, first seek a negotiation with the bank with which you funded, as there may be very attractive plans.
Make well-founded calculations on all your accounts, checking installment dates and amounts, properly planning the use of the new loan so you don’t get lost in debt any further. This is why financial education is crucial!
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