Car Finance

Pros and Cons of Extended Car Loans

What is an extended car loan?

Most financial specialists indicate that an extended car loan is a loan whose duration exceeds 60 months. If you’re thinking about applying for an extended car loan, you should get acquainted with the pros and cons of this decision. For the most part, extending car loans might facilitate some financial relief – and this can seriously be life-changing to people struggling financially. However, what should you know on this topic?

For many, the most important consideration is, of course, the amount of the monthly payment. As a matter of fact, you should note that there are many lenders out there that advertise unbelievably low monthly repayments, as a strategy to attract more and more borrowers.

However, what one might fail to realise is that a low payment is usually the result of long loan duration or the requirement to provide a significant down payment. While facilitating a down payment for car loans is highly recommended to benefit from more favourable terms, it isn’t always a possibility. And this could leave the buyer with only one possibility at hand: which is extended car loans – this could be the only way in which one can manage to keep the monthly repayment amount under control.

Extended Car Loans – Pros

First and foremost, the main reason why so many Aussies prefer extended car loans is due to the low monthly payments. If you have other monthly repayments, for your mortgage or other personal loans, this could mean that you cannot cope with a high monthly payment for your car loan; this could significantly minimise your financial possibilities.

At the end of the day, you should pick the option that works best for your situation, even though this could mean extended loan terms. Failing to cope with your payments is the worst case scenario, and it can happen if you aren’t realistic regarding your budget and needs.

At the same time, it is critical to pick a vehicle that meets your budget. And this doesn’t refer exclusively to the upfront cost of the car – but to its upkeep costs as well, since these add up over the course of time, as well.

While some experts believe that extended car loans should be avoided at all costs, as long as you are aware of both the pros and cons, you’ll know what to expect.

Extended Loans – Cons

Now we’d like to move on to presenting the main cons to extended car loans. As a rule of thumb, the prolonged lifespan of the loan translates into higher interest rates. This is the main disadvantage. Unfortunately, if you were to assess how much money you have spent, you may be shocked.

Evidently, this applies to all sorts of financing whose loan terms are extended. This is why most people prefer higher repayments and shorter loan terms. That’s because, if you go the other way, you’ll end up paying much more than the car’s worth. And you’ll be paying much more in interest and additional costs.

It goes without saying that no one enjoys the thought of paying more than they should. Therefore, perhaps it would be a good idea to consider getting a more affordable car so that you can deal with the repayments.

Taking It All in

When you’re looking for car loans, it’s important to assess a few critical things. For one thing: do you really need a car? For most of us, a car is a necessary acquisition. Do you need a new car? or can you work with a used car? Ultimately, this might suit your financial situation best.

Additionally, you should do your research and look for the most convenient interest rates and loan terms. The offers provided by the lenders can vary a lot. At the end of the day, make sure you factor in the consequences and implications of applying for an extended car loan. In other words, taking out a new form of financing shouldn’t make coping with your debt unmanageable.

If anything, perhaps it would be a better idea to wait until your financial prospects improve and you’re likely to benefit from more favourable loan terms. Of course, this is a possibility only if you can postpone the purchase of the car.

When in doubt, you can always contact Australian Lending Centre – our team of specialists is eager to help you out and get back on track. We provide car loans, refinancing options, and, most importantly, we are willing to customise our offers to your needs.

Car Finance Tips

How to Get A Classic Car Loan on a Budget

Collecting classic cars is one of the costliest hobbies around and it is a little trick to get a classical car loan. The price tag on such a baby is sure to cause a panic attack in many people. People found ways of getting a classic car loan despite having a normal budget that in certain circumstances would destroy their dreams of being at the wheel of a vintage beast. If you’re aiming at getting a classic loan but your budget is nothing out of the ordinary, you might find this guide very handy. Let’s take a look at the steps you have to take in order to get classic car loans on a tight budget.

Classic car loan Guidelines 

Consider private lenders 

Credit unions and banks are not a good source of car loans, especially when you juggle with a couple of loans already. And even if they offer you the car loan you require, it will probably have a huge interest rate and it will be secured on your house. Private lenders, on the other hand, have a wide variety of car loans that come with affordable interest rates. What’s more, many of them are willing to tailor repayment plans for their clients.

You can find a private lender pretty easily. Just surf the Internet for a while and you’ll definitely find one. Stay away from lenders who ask for deposits or any other sort of down payment.

Hire a broker for your classic car loan

One that specialises in car financing, to be more precise; if you can’t seem to find a good deal, no matter how hard you try, such a broker can do some research and get back to you with one.

Moreover, a car broker can easily save you some funding, as well as the hassle of doing all the research on your own. Brokers collaborate with a lot of lenders. Sometimes you don’t even have to pay the broker because he works on a commission. In other words, if he gets you the dream-deal, he’ll get a certain sum of money from the lender he hooked you up with. This is how you save money by hiring a car financing broker.


Tons of classic car enthusiasts choose to lease vehicles and then purchase them. This works perfectly for those people who can’t afford to buy a classic car with a down payment or can’t find a lender that’s willing to hand them some dough. After leasing, you can purchase that vehicle outright and you’ll know for sure how efficient the car is and whether or not it’s as worth it as you thought it would be initially. This is the best alternative to car loans you have (and the safest, to be completely honest with you).


A Home Equity Line of Credit could actually provide you with enough funds to purchase the classic car you’ve been dreaming about for so long. Of course, you have to own quite a large, modern house that has a lot of equity in it. As you might know, a HELOC is a loan that’s secured on your house, which serves as collateral. If you fail to repay the loan, the lender can place a lien on it and sell it. The HELOC, therefore, should be your last resort. The Home Equity Line of Credit usually serves other purposes, but it’s totally possible to get a car with the money that comes from it.

Secured or unsecured

You’ll have to determine if you want an unsecured loan or a secured one. Under a secured one, you’ll get more money and lower interest rates. Under unsecured car loans, you’ll get a more limited amount of money and higher interest rates. But then again, an unsecured loan doesn’t pose a threat to your assets. If you fail to repay it, the worst thing the lender can do is to sue you. Keep in mind that he can get the right to place a lien on your assets even in this circumstance.

Extra caution is therefore advised. You certainly don’t want to be living in a Cadillac, as cosy as it might be. Think twice or even thrice about this issue and make a decision you won’t live to regret after a while.

Concluding Remarks 

Classic car loans are a great way of finding the car you want to get but can’t afford to purchase outright. Australian Lending Centre can provide some really valuable advice when it comes to taking advantageous car loans, as well as the financial products themselves. Make an enquiry on the website and you’ll most definitely find a car loan that suits all your needs and comes with an affordable interest rate and a good repayment plan. We hope you’ll get to be at the wheel of that shiny, vintage car you’ve been dreaming about for years on end.

Mortgage Financial Fitness Financial Planning Home Loans

Will My Car Loan Affect My Mortgage Application?

A car loan can help you a lot if you plan to get your next car faster. However, a car loan can affect your mortgage application or other types of significant loans. If you are planning to buy an expensive car, this means that you will require a large loan. That car loan can impair your future borrowing power. But this doesn’t mean that you need to choose just one of these two.

Let’s see how a car loan can influence mortgage applications and how we can deal with such a situation.

First Things First

When you apply for a home loan, you will need to provide information regarding your financial status. This means that you will have to give documents regarding your monthly income, assets you own and other ongoing payments. This is how a lender will determine whether you can pay back the loan or not. Every lender wants to avoid doing business with people who might not be able to keep their word because of their financial problems. They want profit, not excuses.

If it were a personal loan, your mortgage application would be fine. But since we are talking about an expensive car loan, your mortgage application might get rejected due to your other massive loan. Either that or come with a lot of restrictions.


Will My Car Loan Affect My Mortgage Application?

A car loan will have a high impact on your finances. Given all the taxes you need to pay, a car loan can take most of your monthly income. Still, aiming for a cheaper car might be of some help. Since cars tend to lose their value quite quickly, getting a very expensive one may not be a good idea, especially if you intend to apply for a mortgage.

Mortgage applications will act the same so that you will be left with little to no money. This is why a lender will probably have to refuse your mortgage application.

A lender wants to know that you will pay your mortgage and you won’t default on it. He will analyse your assets and other methods of income. If he sees that you have the financial power to afford a car loan and a mortgage at the same time, he might give you the green light. If not, it might be better for you if you only had one.

Defaulting on a mortgage is not a good sign for your lender and your finances. Car loans and home loans can quickly turn into uncontrollable debts, and you might end up losing everything. So don’t think of the lender as the bad guy, but be objective and calculate what you can and can’t afford, because in the end, if you are dishonest, you will suffer the most. Because banks and lenders make sure they never lose.


Can I Still Be Eligible for a Mortgage Application?

Yes, you can. Your car loan will affect how much you can borrow, but if you don’t want an expensive house, that a limited amount of money can be just enough. If you can’t get the sum you need, you can search for an affordable home. When it comes to loans and money, flexibility is a must.

If you want to increase your chances of getting your mortgage application approved, then it’s time to clean a little bit of your credit file. Pay your debts and try to repair your bad credit. Also, consider debt consolidation as a possibility. Lenders will check your credit to find out who they are dealing with and also what other assets you own, just in case they might have to make up for that loan with something else rather than your money.

Having a savings account is a great idea. It makes you more trustworthy and responsible in the eyes of your lender. Let’s not forget that having some savings might help you quite a lot to reduce the amount you would apply for.

Also, try to talk to your lender. The more information he gets regarding your situation and income, the bigger the chance of getting your request approved. Don’t forget to tell him your exact plans.


Final Thoughts

So, the short answer is that a car loan can influence mortgage applications and under certain circumstances, it can get your requests denied. But do not let yourself discouraged. Evaluate your possibilities, cut down on the unnecessary expenses and, if you can, try to pay ongoing debts before applying for a mortgage.

You can talk about these details with Australian Lending Centre. Our friendly consultants will tell you about your chances of receiving a loan and, if you fit our criteria, you may even get a good mortgage option. Advice never harmed anyone so you should not miss the chance of clarifying your options face to face with an expert.


4 Tips to Pay Car Loan With Bad Credit Faster

Here are some practical, easy tips to help you to pay your car loan with bad credit faster, and how to save money while doing so…

1. Add extra payment on your monthly instalment.

Most of the car loans have fixed monthly instalments. So, every time you make an extra payment, it should go directly to the principal. You can also set up an automatic payment with the extra amount so you could avoid missing the due dates. Afterwards, you can work on increasing the additional payments.

2. Spend your cash windfall to repay your debts

Did you suddenly receive a chunk of money? Maybe you won the lottery or received a tax refund or inheritance and you are tempted to spend on your must-haves. Hold that thought-debt must come off first. Use your cash windfall for paying off car loans faster.

3. Work on your budget

If you want to have more money to pay off your loans as quickly as you can, but increasing your income is not possible at the moment, decreasing your spending is an option. While it is a bit hard to trim your budget drastically, skipping small stuff that used to cost you a few hundred bucks a day is worth it.

For example, if you are paying a thousand dollars a year for your gym membership, why not try cheaper exercise programs with friends until you have paid off your car loan?  You may have to skip clubbing or eating out, but it’s only a short-term. Use your creativity to get cheaper alternatives to things that you used to buy.

If you love throwing big parties, why not try cost-effective celebrations that focus more on experiences instead of glamour? Even if you can only handle cost-cutting for a few months, the amount of money you can save can still help your car loan repayment.

Maybe you can keep some cost-cutting strategies you can use for life, especially the healthy and friendly alternatives.

4. Debt consolidation

It is not easy to obtain a car loan for bad credit with reasonable repayment terms. Lenders look into your credit history to check your ability to pay your monthly instalments. One of the most common financing options for people with bad credit who want to finance a car is debt consolidation.

Here is one of our best tips to pay your car loan with bad credit faster. If you want a stress-free ride, reduced interest rates on your bills and debts and an easy-to-follow debt repayment plan, debt consolidation can help you. You can also enjoy the convenience of making one payment every month.

Debt consolidation helps you become debt-free faster and you can save hundreds to thousands of dollars on penalty fees and debt charges plus accumulating interests from various debts.

Australian Lending Centre helps thousands of individuals deal with defaults, late payments and charged-off accounts that could ruin your credit rating. Their debt consolidation program helps you reduce your debt payments and save money in interests. They also have in-house loan specialists that will guide you on how you can improve your credit score.

Start with a clean slate while you get your dream ride. Getting a car loan for bad credit isn’t as hard as you think, with Australian Lending Center.

Contact ALC today!


Should You Pay in Cash or Get Car Loans?

If you’re looking for extremely low rates to finance a new car, you have to make sure that it is not the only thing you are looking at. Remember that a car dealer gets a better deal when financing your car, than getting paid for it in cash; unless the lender pays for it and you have to pay the financing company on your own. So, it wise to consider the following things when planning to tie up your finances with car loans.

Financing a new car may or may not be a good deal depending on the following circumstances:

  1. Credit report. It’s easy to get favorable loans when your credit is good. But, what about if you have a bad credit? You can still get a car loan by doing the following things:
  • Know your credit score to know where you financially stand.
  • Check your credit report and correct erroneous entries. If there are problem areas in your report, lenders may be hesitant to lend you money.
  • Find a reputable lending company by checking their business in the business bureau, and reading reviews about the company. Good lenders can tell you not only the monthly payment, but the interest rate, loan terms and other hidden fees. It is advisable to work with companies that lend to people with bad credit.
  1. Employment record. When you are hopping from job to job, lenders may not give you the best deals. But, if you have a stable employment, and you have extensive list of assets, the lenders may look at your application favorably.
  2. Outstanding debts. If you have big debt loads and you have financial capacity to cut it down, pay the high-interest loans first and pay off your smaller debts to give some allowance for your payments. This way, you will not only improve your credit score, but your monthly finances as well. Close unused charge accounts and credit cards, except for your oldest credit card.
  3. Budget. If you have earned adequate amount of money and it is sitting there for you to use, why not pay in cash?

If you don’t want to spend more than you earn each month, then getting car loans may not be your best choice. Paying in cash can help you handle your budgets well because you don’t have to pay for the interests. But, if you don’t have large amounts of cash and you really want to buy a car today, then a car loan can help you get it.

Final thoughts

Avoid getting car loans unwisely. Remember the cost of debt. It can leave you in a financial mess if you don’t know what you are getting into.  Don’t succumb to the temptation to apply for car loans which are beyond your means to pay off.

When you apply for car loans always do the math. Figure out if the interest rates, associated fees and loan terms are worth the cost.

For more information, contact us and we will help you find a loan solution that works for you.


World’s Cheapest Car Signals New Era

The revolutionary four door ‘no-frills’ car unveiled in India earlier this year, is the world’s cheapest car, pricing at a mere $2835. The Tata group creation is just the beginning of what is fast becoming the international age of affordable motor vehicles.

In Australia, cars are becoming increasingly more affordable, including both new and used vehicles. Many Australian motorists are issuing a sigh of relief as major car companies have produced a market for more inexpensive and fuel efficient models.

As prices continue to drop for consumers, many are taking up the chance to secure their affordable rides. Why not take advantage too, and talk to ALC about a car loan today. Call us now on 1300 138 188.