Today, more and more people live in our country as single people. However, this does not mean that, as a single person, you cannot bump into quite a few obstacles if you want to take out a car loan. Despite the fact that more than 1.6 million Belgians live as single people, borrowing money for, for example, financing a car often turns out to be a problem.
Positive discrimination for couples who borrow money
In a lot of cases there can even be talked of a form of positive discrimination in favor of couples who want to borrow money. After all, lenders give them an interesting discount when they take out a loan, for example for the purchase of a car. Lending money to a couple ensures a smaller financial risk, but also ensures that a single person can borrow more difficult money.
Take out a car loan as a single person
Many single people regularly wonder how much money they can borrow to, for example, finance a car. The answer to this question is unfortunately not always that simple. You can usually start from the rule of spending a maximum of 1/5 of your net income on a loan to finance a car. In practice, however, you can sometimes negotiate the maximum loan amount with a lender.
How much can a single person borrow?
If you as a single person want to calculate how much you can spend on the repayment of a car loan, you can use an online simulation (on the website of most lenders), among other things. However, if you want to make such a calculation yourself, you must take into account various factors that will influence the maximum amount of the loan, such as:
- the fixed income that you receive,
- the term of the car loan (the longer the term, the less you pay each month. Of course, you pay more interest over the entire car loan. A shorter term, on the other hand, means higher monthly repayments).
- the interest rate (this is linked to the term and the period in which you take out the car loan).
However, you can always negotiate with a lender to see what is possible in your personal situation.
Tips for taking out a car loan as a single person
- If you want to take out a car loan as a single person, you have to take into account that you need to have enough extra money to cover unforeseen expenses. Preferably, you put some money separately in a savings account with a favorable interest rate.
- In all cases, look for a car loan that matches your personal situation. There can, however, be significant differences between different loan forms, such as a personal loan and a revolving credit. To finance your car, as a single person, it is always wise to first be well informed of all possible options.
- Compare the different loan products from multiple providers to find the best deal. Moreover, many credit providers are only willing to make the effort to come up with the most advantageous rate, when another financial institution dares to take the risk.
- Good preparation and many comparisons will ultimately save you a lot of borrowing costs.
- Preferably, you start and end your search for a car loan at your own bank and always take the most favorable rate with you to a subsequent credit provider until a better proposal can no longer be made.
- Preferably start your search for a car loan online. You can therefore easily request customized quotes from a number of lenders.
Have a guarantee
As a single person, it will certainly work to your advantage if you have a certain guarantee when you apply for a car loan. You can think of:
- savings that can serve as collateral,
- an own home,
- other valuables,
- people who want to guarantee you.