As one of the Big Four, ANZ is a household name in Australia. It’s a name most Australians know well, so it offers customers a certain peace of mind when it comes to their financial matters.
But is ANZ the right choice for your car loan?
Sure, ANZ is one of Australia’s biggest banks, and with that size and status comes certain perks. There’s that peace of mind that many people look for when dealing with financial providers. There’s also the fact that as a bigger bank, it can offer a larger variety of products.
However, larger financial providers may also charge more for their products. A big bank may know it can rely on its customer base, so it can charge a bit more without its customers looking elsewhere.
When it comes to car loans, ANZ does have a lot to offer. As for the cost of those car loans, a car loan calculator should allow you to compare what ANZ car loans can offer, to find out whether they are cost effective for you.
Let’s take a look at the various car loans ANZ has on its books, so you can make an informed choice.
ANZ car loan finance options
ANZ has three car loan options for you to choose from. There is the ANZ Secured Car Loan, the ANZ Variable Rate Loan, and the ANZ Fixed Rate Loan. Time to check out the pros and cons of each type of loan.
ANZ Secured Car Loan
The ANZ Secured Car Loan can offer financing for cars and other vehicles, providing a fixed rate loan that is secured against the vehicle you buy. Why should you choose a secured loan over an unsecured loan?
With a secured loan, the lender knows that if the loan goes bad and the borrower fails to pay off the loan in its entirety, the vehicle is there as collateral. The lender is within its rights to sell off the vehicle to make back the money lost on the loan.
As the lender has this security, it can offer lower interest rates on the loan, which can help the borrower save money on interest paid back over the life of the loan. On the other hand, an unsecured loan may feature higher interest rates.
The ANZ Secured Car Loan also features a fixed rate of interest. This can protect the borrower against interest rate rises, and it can also make budgeting easier, as the repayments will remain the same through the life of the loan.
Another feature of this loan is the ability to make a lump sum final payment (also known as a balloon payment) at the end of the loan term. This can make repayments lower, on loans approved over one to five years.
ANZ Variable Rate Loan
As the name suggests, the ANZ Variable Rate Loan attracts a variable rate of interest. That means the rate of interest may go up or down over the life of the loan, according to the market.
If interest rates fall, the borrower may enjoy lower repayments, but if interest rates rise, repayments may rise with them. However, the ANZ Variable Rate Loan does offer a certain degree of flexibility.
First up, there are no early exit fees if the loan is paid off early. You can also increase your loan repayment amount, giving you access to a redraw facility should you need it. Plus, as it is an unsecured loan, you don’t have to use your purchased vehicle as security.
ANZ Fixed Rate Loan
For some, a fixed rate loan is preferable over a variable rate loan. Like the ANZ Secured Car Loan, the ANZ Fixed Rate Loan offers a fixed rate of interest over the life of the loan. That means no matter what the market does, repayments should stay the same.
This can make budgeting easier, as borrowers always know exactly what they are paying each month. However, unlike the ANZ Secured Car Loan, the ANZ Fixed Rate Loan is not secured against the vehicle purchased.
When comparing car loans, it’s not enough to simply look at the loan’s rate of interest. You also need to work out how much you will pay in fees. With the ANZ Variable Rate Loan and ANZ Fixed Rate Loan, there is loan approval fee, plus a monthly loan administration charge.
With the ANZ Secured Car Loan, there is an establishment fee and a monthly administration charge. The ANZ Fixed Rate Loan and the ANZ Secured Car Loan both attract fees if you pay off some or all of your loan early. Each of the loans attract a late payment fee.
Time to compare the options? Be sure to read the small print on each loan option, using a car loan calculator to work out loan costs – and to find a repayment schedule that works within your budget.