Car Loan Regulations: Borrower Responsibilities & Benefits

Car Loan Regulations: Borrower Responsibilities & Benefits

Applying for a car loan has become easier than ever thanks to digitally enabled processes and attentive brokers. While these lending processes are generally made to be quick and stress free, there are still some important fundamentals to know about, and steps that need to be taken. Car loan regulations may be subjective depending on not only the bank or lender you work with, but it may also change depending on which state or territory you live in.

In this blog, we’ll be going over some of the most important aspects of these regulations that you need to be kept up to date with, so that you don’t go into the loan process blindsided or confused. If you’re looking for a specialist lender to work alongside of, FinanceBeagle are here for you.

Ready to get started? Get in touch with a car loan broker at FinanceBeagle on 1300 225 525 or 07 38 849 577 today!

Auto Finance Regulations: What You Need to Know

Credit Laws for Car Finance

When it comes to financing for a car, there are strict credit laws that come into play that will either ensure you qualify for a loan of this sort, or not. These include:

• The National Consumer Credit Protection Act 2009 (NCCP)
• The Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF)

The best thing you can do when starting your financing journey on a vehicle is speak to a professional about these specific laws. Not only is it important to be in the know about how credit works in your country and state, but it’s important to understand the credit laws that apply specifically to car loans.

What Identification Do I Need?

Car loan regulations go all the way down to brokers as well. Brokers need to acquire very specific information about their potential borrower when running checks and arranging finance. This ensures you are the person that you claim to be, but also allows them to place your information on your relevant lending documentation. This will always include:

• Your full name
• Your date of birth
• Your full residential address

The documentation put together by your broker is going to be verified using one of these three pieces of information (for the most part, it will be your date of birth or full residential address). If a broker is ever uncertain, or simply wants some additional level of information, they are required to ask.

What Does a Lender Need to Comply with These Laws?

Lenders need to comply with strict laws and regulations to be able to lend money as well – it isn’t a one-way street. Under the National Consumer Credit laws, any person responsible of lending you money but be registered and/or licensed and must do so responsibly. If you are unable to pay your loan back, or a broker believes something will hinder your ability to do so, they must not approve your loan application.

As part of auto finance regulations, your broker and even credit providers must:

• Conduct reasonable inquiries as to why you want to borrow money
• Make reasonable inquiries about your financial situation
• Take the responsible and reasonable steps into verifying your finances and financial situation
• Determine whether you will be able to meet financial obligations

If you request a copy of the credit and financial assessment, the credit provider must provide you with one. If the contract is deemed unsuitable for you and your financial situation, the provider must NOT lend you money.

Information the Lender Must Provide

If your application has been accepted, and an offer has been made, you are required to receive, under the NCCP, clear information about the loan and the lender, including:

• Credit guide and quote
• Specific information about the loan itselfTotal amount of the loanInterest rates and how they applyThe number of repayments requiredHow the repayments are calculatedThe frequency of your repaymentsWhen these repayments are due to be paidDetriments that may apply
• Total amount of the loan
• Interest rates and how they apply
• The number of repayments required
• How the repayments are calculated
• The frequency of your repayments
• When these repayments are due to be paid
• Detriments that may apply

Why You Should Work with FinanceBeagle

If financing a car has been on your mind for a while, but you’ve been wanting to find a specialist that you know you can trust, you’re in the right place. Backed by a number of years of experience, our team pride themselves on offering a personal yet professional approach to our services. Our people are our strength and taking care of YOU is not only what’s important to us, but it’s what we do best. Let us dig up the best deal for you and take care of all the difficult stuff to ensure you get the deal that best suits not only your financial situation, but your lifestyle and goals as well.

Contact Our Specialists Today!

If you want to understand more about car finance regulations and get a better grasp before taking the plunge, get in touch with the team at FinanceBeagle on 1300 225 525 or 07 3884 9577 today. Our professional brokers are here to make the process of financing loans as simple as they possibly can be. Alternatively, if you’re ready to get started, reach out online to request a quote or get in touch through our online form.