They’re car loans everywhere in Jamaica.
From commercial banks to credit unions, they’re no shortage of it. That’s a good and bad thing.
The good part is that you have many options to choose from.
The bad part is that some of the car loan providers in Jamaica can be very aggressive if you default on the payment.
When you find yourself in need of a car loan, you should think it through before making such move.
There are so many things to consider and the amount you wish to borrow will all factor into your account.
It’s important that you do all of your research before turning over your hard-earned money to a financial institution. Here are 15 tips before taking a car loan.
1. Figure out how much you can afford to borrow
First and foremost, you need to figure out how much money you can feasibly borrow.
This means looking at exactly how much money you make every month and determining the amount of money that will be left over after all of your expenses are paid.
For example in Jamaica, if a person makes $100,000 JMD each month, they can most likely borrow around $1.5 – $2 million JMD under good circumstances.
However, it may vary from person to person as it depends on how stability of your income and credit history.
2. Look for low interest rates on car loans
Once you’ve determined an appropriate loan amount, look for some good options online with different Jamaican financial institutions as far as interest rates go.
Try to find some sort of deal that you can negotiate with your bank or credit union.
3. Get financial opinions on car loans
You should also seek opinion from persons you know who have successfully borrowed money to buy a car in Jamaica.
Ask them about the process and what the expectation was in case any goes bad.
Hearing first-hand accounts from persons who borrowed from banks or credit unions in Jamaica will you narrow down your focus to the best options.
This way your time is spent more efferently.
4. Get your budget together
It’s important that you know exactly what is coming into your account each month and what is going out if you’re looking for good car loan options.
You don’t want to be in a position where you can’t afford to pay the loan back, so it needs to be carefully considered.
If you have a lot going out each month and not much coming in, otherwise known as being “cash-strapped,” then taking on an expensive car loan might not be the best idea for you right now.
Be realistic about your current situation and don’t take on a burden if you know you can’t manage to pay it back every month.
5. Take into consideration your debt-to-income ratio
Your debt-to-income ratio is the ratio of how much money you owe compared to how much money you’re making per year.
This number should never exceed more than 28% if possible.
If you are already struggling with credit or this number is higher, look into refinancing options or loans with lower rates.
But remember that it may also mean a longer repayment term.
6. Get your loan papers in order
When you are approved for a car loan, make sure you get all of the paperwork in order before signing anything.
Make sure that all of the terms are spelled out and if there is any fine print.
Read it over carefully, so you’re clear on exactly what is expected of both parties.
7. Don’t be afraid to shop around different car loan companies in Jamaica
Don’t feel intimidated when shopping for a good deal.
Remember that there are plenty of car loan providers in Jamaica, use this to your advantage to your get the best deal.
You shouldn’t have to settle for bad services or being mistreated by companies just because they happen to be conveniently located down the street from your home.
8. Ask for help if you need it
Don’t be afraid to ask friends or family members for advice when looking into car loans.
They might not be the ones providing them, but people like this can give you some valuable insight that will make your experience much less stressful.
9. Have an exit strategy in mind
Remember that getting a loan is never permanent, and chances are good that it won’t last forever.
If you aren’t sure how your repayment schedule works or if there’s any sort of penalty clause associated with paying off early, make sure you look into these things before committing yourself to anything.
It’s also good to know what will happen to your car.
Do you own it outright once the loan period is up? Or will you need to turn it in?
It’s life things can change fast, so ask questions for different scenarios.
10. Don’t forget about insurance
If you finance a new car, the lender will probably require you to buy some sort of on-loan vehicle protection.
Make sure that whatever is required aligns with your needs and does not cost an arm and a leg.
There are plenty of car insurance companies in Jamaica. So go out there for good rates if you look around a bit.
11. Don’t let last minute expenses get in the way
Make sure that when taking out a car loan, you have all of your terms agreed upon before going into any deal.
If you’re looking at buying a car from one place specifically, make sure its financing department has been made aware of this situation, so there aren’t any surprises after the fact.
12. Don’t forget to budget for upkeep and regular maintenance
Your new car will need regular maintenance in order to keep it running well.
So don’t neglect that.
It’s still best to set aside a small amount of money out of each paycheck for this kind of thing to deal with unplanned expenses should they arise.
This includes things like oil changes or tires.
Also accidents can happen at any time so be prepared.
Don’t let the stress of getting a good car loan in Jamaica stress you out.
Just plan ahead, get all the paperwork you need signed before doing anything, and always pick reputable Jamaican car loan companies.
Remember, The key to getting a good deal in this situation is preparation and research.
Don’t be afraid to ask for help and never stop looking around until you’ve found the best possible options.
That way, when the time comes, it’ll be much easier to get everything squared away without any issues or surprises along the way.