Can the bank promise me something?
In practice, banks rarely use the term promise for car loans. On the other hand, it is a nod to the Borrower, thanks to which he can be sure that he will obtain money in a given time. This is very important especially in the case of car loans, which are granted for the purchase of a given, usually dream car. This is due to the fact that buying a car is usually a spontaneous decision. Hence the limited duration of the promise, which in the case of commitments for repayment of the purchase of the car is not longer than seven days (including public holidays). See http://www.bestsatnav.org/bad-credit-auto-financing-auto-financing-with-bad-credit-we-can-help-you/ for a write-up
Additional benefits from getting a promise
Instant access to cash is the most important, but not the only benefit, resulting from the use of the promise option for a car loan. It is also worth knowing that having a promise, a bank customer does not have to do any unnecessary formalities. All you have to do is report to the bank to get the funds and … ready. Another benefit of the loan promise is the lack of a waiting period for money. In the relevant certificate, the bank clearly defines in which period the funds will be transferred. Yes, if for various reasons the Customer is not willing to buy a given vehicle, the promise will expire and it will be necessary to apply for a new one. Not without significance is the fact that issuing a promise releases the potential Borrower from the need to re-send documents and forms in order to re-assess the customer’s creditworthiness.
Not just buying a car
A promise for a car loan is not a very popular solution among banks, but if it is, it usually allows not only to finance the purchase of a given vehicle, but also – if necessary – to finance additional needs of the driver. Usually, we mean the need to retrofit the car with appropriate components, mechanisms and other upgrades (optional removal of any defects) and even its comprehensive insurance, including AC insurance. Of course, it is very important that any information on this subject is accurately presented by the potential Borrower in the application. Unfortunately, this “additional security” also has its drawbacks. Of course, it is usually completely free and not only when the promise is issued for the first time, but also each time, in relation to the same customer. On the other hand, it should be remembered that such a “service” may translate into increased costs of credit obligations, in the form of, for example, additional interest, or higher commissions (insurance rates). Sometimes, promoted car loans are simply more expensive than their traditional cash counterparts.
A car loan with a promise is a very beneficial solution that allows you to minimize the risk of insolvency if you want to buy a specific car. On the other hand, however, you need to watch out for such offers and carefully study their cost distribution. Although the promise service is usually free, the bank may increase the cost of such a loan, which results from the specificity of the Borrower’s use of its financial assets.