Thinking About a Car Loan? Find Out Why Synergy Credit Union is the Right Choice

When you’re budgeting for your new car and realise you need to explore loan options, you might think that a motor finance company or car dealership will offer you the best deal. However, it’s worth taking some time out to check the implications and potential problems with taking out a car loan in this way, and comparing these with a Synergy Credit Union loan, which enables you to become a part of your local loan community.

Car loans are notorious for their high interest and long loan periods, keeping drivers trapped in long-term debt. The promise of low monthly payments can be tempting but looking after your financial well-being in the long-term means looking at the flexible options offered by your credit union and weighing up the predictability and consistency of these as an alternative.

Potential Problems with a Car Loan from The Dealer or Garage

PCP (Personal Contract Plans) and other finance arrangements with car dealerships tend to have the following:

• Restrictions on mileage. Your mileage may be limited as part of your finance agreement.
• Maintenance requirements. There may be stipulations about where you can get your car repaired or maintained, such as servicing at approved garages only.
• Questions over ownership. You do not actually own your car until your last payment is made when you take out a PCP agreement, and this means you cannot sell it before your contract ends.
• Balloon payments. A ballon payment is a large, final payment that is required in order for you to legally own the car, and this can be a significant, often unexpected expense.
• Hidden costs. There are often hidden costs with PCP and similar loan arrangements, which make the payments that seem affordable much more expensive on a monthly basis.

As well as this, you run the risk of the car depreciating in value from the moment you begin driving it. This means it is possible for you to end up owing more money than the car is worth, so that selling the car would not pay off the balance of the loan.

Signing yourself up for a loan such as this can feel overwhelming when you realise these implications, leading to a great deal of stress.

An Alternative Way to Finance Your Car Purchase

An alternative is a car loan from your local credit union, which is usually offered at a low rate with agreed repayments. A credit union involves people from the local community, who are connected by their locality, their industry or a collective association. A credit union is set up to benefit the members who belong to it, rather than to make profit, and any profits your credit union makes will be invested to improve the union itself or shared with members as a dividend.

Our car loan interest rate is only 7.95% (8.25% APR), making your repayments manageable, and there are many other benefits to taking out a loan with us. The benefits of a loan from Synergy Credit Union include:

• Your loan will be insured against your disability or death at no cost to yourself
• Repayments can be designed to suit your needs
• You can access a range of very competitive and reasonable rates
• Repayments are calculated on your reducing balance, meaning that you pay less interest overall and you are less likely to be in negative equity
• You can use Open Banking to manage and share your information securely with less hassle
• You will not be charged for taking out your loan, and you will not be surprised by any hidden fees or charges.

This makes a car loan with your Credit Union a more reliable, cost-effective option that causes you less stress.

Green Car Loans

If you are looking to reduce your carbon footprint and travel in a more sustainable way, a green car loan may be a good option to explore. Electric cars are developing quickly and becoming a great way to do your bit for the planet, and there are schemes to make these more accessible to the general public. If you are interested in a green car loan, talk to us about the possibilities and find out how we can help.

Your Local Synergy Credit Union

Your local Synergy Credit Union is owned by members and offers you financial freedom through flexible loans and financial support for life’s essentials. To begin your application for a car loan or green car loan through your local credit union, you’ll need to become a member of the union and then you are eligible to apply for a loan. To join the Synergy Credit Union, you must be living, working or going to school in our common bond. If a member of your household is a member, you can also join the Credit Union, regardless of where you live. You can apply online, or we can talk you through the process and help you every step of the way.

You do not need a savings record to apply. You can join and apply for a car loan on the same day. Simply join using your phone, and once your membership is approved, you can proceed with your car loan application - https://synergycu.ie/membership.

Our Credit Union Members also receive discounted car insurance with Allianz – up to 18% off! See more here - https://synergycu.ie/services/car-home-pet-insurance.