Car Loan: comparison and criteria


Buying a car is a big buying decision for many economies. Sometimes, however, getting a car is a necessary prerequisite, for example, for business trips and other everyday expenses. The public transport network is almost always inadequate and it is not possible to do without a car. In addition to the mortgage loan, the car loan is one of the most significant loan decisions. In Finland, however, taking a loan for a car is quite common.

An existing car can also go wrong or it may be profitable to replace the car if the repair is no longer sensible. The purchase of a new car can therefore be an economically sensible decision. Older cars consume more fuel and can spend a lot of money on maintenance. Despite the cost of acquisition and possible borrowing, many end up buying a new car. It is often not possible to finance such large purchases without loan money. An appropriately sized car loan will not pull the economy too tight, and the monthly costs will remain reasonable. It is therefore possible to acquire a new car without the economy being too tight.

However, it is necessary to compare the interest rates of the car loan and to compete for a suitable financing option. To find out where the cheapest car loan can be found, it’s a bit of a hassle. Car loan offer options are now available on a large scale and are also one way of increasing sales to car dealers. Today, there are even interest-free car loan offers. The best car loan can often be found with little effort – so compete for a car loan before you go shopping.

What is a Car Loan?

What is a Car Loan?

With a car loan you can borrow up to 20,000-50,000 euros. Some financial operators grant car loans for consumer credit up to € 60,000. Depending on the amount required, a car loan may be either unsecured or secured consumer credit or a traditional bank loan. Car financing can also mean installment financing. Thus, you can take out a car loan or pay for the car in parts with a installment agreement. When talking about the actual car loan, the car can be paid at once, and the ownership is transferred to the buyer as soon as the stores are completed. In addition, a car loan can be used, for example, to finance a boat or motorcycle.

The exact credit applied for a car purchase often does not require collateral. Accurate credit is a good option when the loan amount is up to EUR 15,000-20,000. For example, OP offers an unsecured car loan up to € 15,000. Other prominent players include Fellow Finance, which offers a car loan up to € 15,000 starting with a 5% fixed rate. Santander also offers car financing solutions at a fixed rate. Larger loan amounts can be, for example, secured loans in the form of traditional bank loans. For example, the owner-occupied apartment can act as a security. In this case, the loan amounts can reach up to EUR 50,000. For example, Nordea offers its customers unsecured and secured consumer credit for buying a car between 2000 and 50,000 euros. Car financing can also be financed by installment financing. Then the car will work in practice as collateral, and usually no separate collateral is required. Today, there are many foreign and domestic players in Finland, in addition to traditional banks that provide consumer credit for the purchase of a car.

All in all, the cost of the car loan and the terms of repayment depend on the choice of financing option. You can often apply for a car loan online, and a car loan counter helps you calculate a loan that is right for you. You can apply for car financing before going to the car dealership. Once a suitable car is found, you can use the registration number to search for a car loan for the selected car. So, the buyer can choose from a wide range of cars to suit his needs and find a suitable financing solution for that situation. You can quickly get a financing decision online by e-mail or mobile phone, and you can go to the car dealership with a loan promise. Often, the loan amount can be obtained from a bank or other financial institution to its account within a day, up to a couple of days.

Nowadays, the car is increasingly purchased through a financing solution. A car loan is a personal loan that allows the car buyer to finance the car instead of paying the sum in cash. Car ownership goes directly to the car buyer when it comes to the so-called exact loan. In this case, the borrower will repay the loan to the lender, as agreed in the loan terms. In other financing options, such as the installment agreement, the car will act as the actual guarantee of the contract and the final ownership of the car will be transferred to the buyer only after the full amount has been paid.

Compare car loans

here is enough competition in car loan offers and financing solutions. Some stores offer the buyer of a new car a so-called 0 interest car loan. However, with a 0% interest rate, you should be cautious and check the total cost of the loan, terms and repayment plan. Often, a 0-interest car loan is suitable for a short loan period, ie a quick repayment period, but there have been 0 interest-bearing loans on the market with several years of repayment. Those who are otherwise best placed financially will easily get the best terms for their loan. It is therefore advisable to bid for financial offers in the same way as other loans. However, cars can now be obtained without a down payment and at zero rate.

Because the competition in the car market is tough, interest rates in financial solutions may fall close to zero. The low interest rates of car dealerships have been in the past few years. Still, many consumers ask for a car loan from their own bank. Although the costs of traditional banks can often be moderate compared to other unsecured consumer credit markets that are found on the market, the result will often be that the car dealership will be able to bid better.


Some of the loan providers have made clear conditions for obtaining a loan. However, the final decision on the loan arises in the search process when all the necessary information is entered on the loan search platform.

The general terms of the loan are:

  • Age – often the age range varies from 21 to 26 years. Only some lenders offer loans to 18-year-olds, which is the legal limit for access to the loan. However, usually a little older gets a loan easier than just a person aged 18 or over.
  • Credit Information – Usually, the borrower must be sound with regard to the handling of previous monetary matters, and often the loan will not be granted to those with a default.
  • Place of residence – In Finland, the loan is only available to a permanent resident. Actual citizenship is not an absolute prerequisite, but it is possible that a person should have been living in Finland for a long time.
  • Revenue – Perhaps the most influential factor in obtaining a loan is the amount of income. As a rule, a person must have a regular income, and sometimes the income must be a certain retail amount per month or year (for example, 1500 euros per month before taxes and 18,000 euros per year), depending on the amount of Loan sought.

In addition, for example, the form of housing, depending on whether you live in a rented or own apartment, may affect the conditions for obtaining a loan.