Looking for low doc car loan? Are you self-employed? If you are not working on a stable salary, or a freelancer, contractor, an entrepreneur, or a self-employed person and want to finance your car, there will be no better option than a low doc car loan.
This will require just a few documents than is normally required, but in this type of commercial car finance option, lenders do not approve loans easily because of the risks associated with the loan. You are not on a fixed salary; it means lenders do not have the surety that you can return your loan. Therefore, lenders often charge high fees and rates for these loans.
Various factors and parameters should be taken into account when you decide to choose this loan. These parameters are listed below:
Fees associated with this loan:
Before applying for this loan, you should check the upfront fees associated with this loan. This is the fee you will need to pay to the lender in order to set up the loan for you. Plus, you should also check the ongoing fees beforehand.
Interest rate:
Whether you are opting for car loans or caravan loans, low doc loans always have higher rates than standard loan options. Therefore, you should compare the options in order to make sure you are opting for the best possible deal. Check the interest rate attached to the loan, whether it is fixed or variable.
Kind of documentation:
Many lenders do not require any proof of your income; however, they will require a few documentations in which detailed information should be clearly mentioned regarding business activities, assets, finances, and debts. Having these documents in the lender’s hands will be able to determine your financial situation.
Loan amount and terms:
While applying for this loan, you should read the terms and conditions of the lenders. You should make sure the amount of loan they are offering is enough to meet your borrowing needs. The amount of money offered by lenders normally ranges from $3000 to $100,000 for 1-7 years.
Restrictions on loan:
Some loans may have specific restrictions. For example, when you apply for a loan, there is a restriction that you should use this amount of loan only to finance your vehicle. Therefore, you must check the restrictions on your loan before applying.
These are the most obvious parameters that can be considered when applying for a low doc car loan.