The vehicles are elegant, luxurious and powerful. Most drivers dream of owning a Mercedes at least once. The loan should make this dream possible. The money house belongs directly to the car company and is responsible for managing the company’s financing issues.
Since a Mercedes has its price, which at first glance makes a vehicle of the group accessible only to people from the upper income brackets, the car loan starts at this point and wants to make the big price affordable even for smaller earners: It is therefore available in three forms: financing, final installment financing and standard financing.
The car loan as financing
The financing is an extension of the classic balloon financing, which the bank also offers. Because a car loan as financing gives the borrower the option of repaying only half of the loan over the agreed term and saving the rest for the final installment.
When it comes to paying the final installment, there are three options that give this form of financing its name: he can sell his vehicle and pay off the final installment with the profit; if this option has been agreed, he can sell it to the dealer return, the final installment is deemed to have been settled or he can pay the final installment. This happens in two ways: either he simply repays them because he has the funds or he has to take the next car loan.
The car loan as final installment financing
You can also choose this option when you take out the loan. In principle, the concept is that this is the option of simply converting one loan into two loans. After the first loan has been repaid down to the final installment, you will receive a new one with which the final installment will be paid and you will then pay off this so-called “follow-up financing”.
The car loan as standard financing
In principle, the name standard financing is self-explanatory. You repay a loan at equal rates over a fixed credit period. While the final installment financing and its variation financing has the advantage of being able to offer low installments, but has the disadvantage that after a few years you no longer have a vehicle or have to repay the loan for a very long time, it is the standard Financing vice versa: The rates can be very high, but you pay the loan in full and keep the vehicle.