Georgia Loan Advice

“The car is not a luxury but a means of transportation!” – This catch phrase of Ostap Bender, is the best reflects today’s reality. In fact, the car for the Russians ceased to be an expensive luxury, and is perceived simply as a vehicle designed to make life easier for its owner.

Important role in such a fast “car ownership” of the population has played (and continues to play) car loans. We say more – almost every third car, which travels about the Russian expanses, borrow.

Recently, in connection with the global financial crisis, the Russian market lending does not develop so rapidly. However, banks today are not inclined to complain about the lack of customers – who want to get brand new cars for several days until enough.

But the real boom in auto loans observed in the pre-crisis time – from 2006 to 2008. For example, in 2006, car loans different banks of Russia on the amount of 8.5 billion dollars. What are the loan programs? They can be divided into two types – a classic credit, and express loan. We consider each of them in detail.

Getting a “classical” credit is as follows. The client collects the required documents, and provides it to the bank together with the application for a loan. If the bank makes a positive verdict (it takes from 3 to 10 days), the client makes its first contribution – no less than 10% of the value of the car. The loan has a repayment term of up to 5 years, the interest rate varies from 9% to 14% per annum. The amount of the loan, usually paid equal shares within a specified period.

As for the “Express Loan”, the essence of issues very name. This means that your application is considered by the Bank as soon as possible. However, such loans are not issued more than three years, while interest rates on them considerably higher – up to 18% per annum. Besides all this, banks are placing increased demands on the recipient – the chances, in comparison with “classical” credit, less than a few times.

Most banks add to the terms of the contract for the express loan hidden charges. So if you have decided on such a loan, be prepared for the fact that the rate of pay.

Which loan is suitable for you? The classic version of the chosen people, who are carefully weighed, and not willing to pay extra money just for something to get the car faster. They are more attracted by the stability and clarity of the conditions of “classical” contract. However, life is everything, and people are all different, too – and if you can not or do not like to wait and are willing to pay for their desire – express a loan is what you need.

In fact, car loans – a loan against property, in the role played by the car.
The scheme is simple – showroom subscribes to the client account, and bank transfers through the showroom on the desired amount. After this car goes to the client’s property. At the same time a car is made as collateral on the loan. And, in case of nonpayment of the required amount, the bank will simply pick up the car in arrears.

A prerequisite for obtaining credit is the design of an insurance policy – compulsory motor TPL insurance and helmets. Therefore, the customer shall insure the vehicle from the consequences of accidents or theft. Before the last installment payments on the loan, a car registration certificate is in the bank that issued the loan.

What is the future for car loans? People quickly get used to the good. All items that have recently been available only to wealthy people – dear consumer, audio and video equipment, cars – are now available to anyone with a stable income. Today in the credit can be obtained almost everything – from the CD to the mansion. And the cars here – not the exception.

Banks are fighting for every customer, and continue to offer loans to all the best conditions – lower interest rates and the initial contributions, increasing maturity. And, most likely, lending in general, and auto loans in particular, will continue to thrive both in Russia and CIS countries.