Buying a car on loan in Nigeria has undoubtedly become one of the easiest ways of owning a new vehicle. It has become a popular route for people who don't have the complete money to buy a car by paying cash. With the present economic situation in the country, saving up for a car can take a longer time than expected. And individuals may never realize their dreams of having a car to call their own. This explains the reason why a large number of salary earners now hunt for ways to obtain a car loan in Nigeria.
Now, it doesn't matter whether you are looking to get a car loan for Uber in Nigeria or just want to get yourself a car; this article has all the information you need. We have carefully researched and discussed in this article all there is to know about vehicle financing or getting a car loan in Nigeria. Read on!
1. Car loan in Nigeria - How does it work?
Individuals and cooperate bodies don’t have to wait anymore till their money is complete before acquiring a new car in Nigeria. Yes, you can now own a new car while paying in instalments over a period of time. It should be however noted that not everyone who is looking for a car loan is eligible. A lot of car financing companies usually have laid down policies and rules that must be followed. For instance, if you don't have a verified source of income, you don't expect to get a loan to buy a car.
Car loan has made it possible for folks to buy their dream car now and pay later
1.1 How to get a car loan in Nigeria
Getting a car loan in Lagos Nigeria or just about any other State is way easier than you might think. It doesn't matter whether you want to go into the transportation business or you need a car to ease transportation issues, there’re steps required to get a car loan in Nigeria 2021. For example, you are expected to have a minimum monthly income that ranges from N150,000 to N250,000. If you meet this first requirement, you automatically qualify for a car loan. Check out the below-highlighted requirements that are common to car loan companies in Nigeria.
Requirements and steps to get a car loan in Nigeria
A. Identify your dream car and how much it costs
Who wants a car loan but doesn't know the type of car and how much it costs?
Vehicle financing is a serious deal and should be taken so. Before you go looking for an auto loan service, you must first know the car you intend to buy and how much it cost. You may want to go for a new car or a used car. Making a choice upfront will help you make informed decisions that'll not be burdensome on you. Folks looking to go into the Uber business should know the type of car that is suitable for them. Knowing the car and how much it costs makes the car loan process easier.
B. Verified source of income or salary
When seeking a car loan, you must have a steady source of income. This is required to know if you have the financial capacity to pay for your desired car over the stipulated period of the car loan agreement. Financial institutions make it a point to issue loans to salary earners and business owners who have a steady flow of income as they can pay back the loan without hassle. So, if you don't meet this requirement, you might hardly get a car loan in Nigeria.
C. Look for trusted car loan companies
If you've scaled through the first two steps, the next step is to look for verified car loan companies. There’re several car loan platforms and Nigerian banks that have positioned themselves as car loan service providers in the country. They mainly help people get their own car, whether it's a brand-new or used car. These institutions have several mapped-out car loan features with structured repayment plans which individuals have to examine to know if they meet the criteria.
Things to consider during a car loan deal in Nigeria
1. Interest rate placed on the car loan: Look for a car loan with a favourable interest rate. You definitely have other financial obligations so the last thing you need is a car loan that has a high-interest rate.
2. Monthly instalment and tenure of the car loan: Look up the monthly payments on the car to know if you can afford to part away with such an amount every month without placing a strain on you. Can you complete the payment within the period of time attached to the loan?
If you've considered all of the above, then move on to the next section of this article which discusses where to get a car loan in Nigeria.
You must have the financial capacity to pay for a car before getting a car loan in Nigeria
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1.2 Where to get a car loan in Nigeria
If you're looking for where to get a loan for a new car, there are quite a number of car loan companies in Nigeria. Similarly, there are also many financial institutions that provide auto finance in Nigeria. They all require you to fill a form while providing documents to facilitate the car loan. Check them out in the list below:
Banks that offer car loan services
Some financial institutions in Nigeria have created easy ways for customers to acquire their own car, even when they don't have the complete fund. Nigerian banks like Stanbic IBTC, UBA, FCMB, and Access bank have set up schemes to enable individuals to get vehicle financing in Nigeria.
Access bank car loan
Access bank provides customers with a user-friendly car loan feature that'll help them acquire a new or used car in an easy way. The loan is only open to salary account holders, small-medium enterprises (SMEs), and corporate bodies. Access bank is in collaboration with various car dealers in Nigeria like Autochek to give customers more options to choose from a wide array of auto brands. Only recently, the bank partnered with Hyundai Motors Nigeria to launch a new car purchase scheme titled "Buy Now, Pay Later”. This payment plan allows customers to start paying in 3 months’ time. They are to pay 200,000 monthly for a period of 4 years.
Access bank and Hyundai Motors Nigeria recently rolled out a new vehicle finance scheme called "Buy Now, Pay Later"
FCMB auto loan
FCMB runs a customer credit scheme where qualified individuals are allowed to make a part payment for car acquisition. With this scheme, customers can get up to ₦30 million car loan and pay during a stipulated time frame which is 3 years. The interest rate is 20% per annum
UBA auto loan
Just like other Banks offering car loan services, the UBA auto loan product allows customers to drive their first car and repay at their own convenience. Not only that, but customers also have the opportunity to upgrade to a higher model. Auto brands approved for this car loan include Hyundai, Mercedes-Benz, Nissan, Kia, Volkswagen, Suzuki, and Ford.
Car loan companies in Nigeria
Here are the popular ones that we know of:
Betacar is an e-commerce car loan company that allows individuals to buy used cars and pay in instalments. The company offers an affordable and flexible car financing option for salary earners and business owners. Loan seekers are required to pay 30% of the money while spreading the balance over 12-24 years.
Creditville Limited is an online money lending platform that provides payroll-based loans to qualified individuals. One of their products is car lease and hire purchase which is designed for individuals who want to have their own car through hire purchase.
=> Other popular car loans companies include Car45 and Credit Nigeria.
If you meet the requirements for a car loan, you'll become qualified for a loan to drive your dream car in Nigeria
2. Car loan in Nigeria - Pros & cons
1. One of the advantages of opting for a car loan service is that you are able to have immediate access to your dream car. You don't have to wait for many years or complete payment before you ride but rather you ride now and pay later.
2. Cars costs a lot of money and it may gulp all of your savings leaving you with many unmet needs. However, with car financing, you're able to own a car and still get to meet other financial obligations that require immediate attention.
3. Paying off your car loan on time helps build up trust and a good credit profile. Your creditworthiness will come in handy in the future.
1. Car loan companies give out loans to people with Interest rates and fees attached. Some of the interest rates are very high and this sometimes makes it impossible to pay back. For instance, banks lend at interest rates ranging from 18%-30% yearly which makes it difficult for people to access.
2. There are stipulated periods of time loans are expected to be paid back. Failure to pay when due attract an extra fee. And this punishment basically increases the amount to be paid back.
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3. Car loan in Nigeria - Advice & recommendations
There are a lot of things that go into securing a loan for your dream car so don't be in a rush to make a financial decision. Simply follow these recommendations.
- If you're qualified for a car loan, cast your net wide by checking out multiple car loan service providers to get a better loan offer.
- Examine the interest rate and go for the deal that's more realistic and won't impose any financial burden on you.
- Lastly, don't be in a hurry to sign documents. Take out time to go through the terms and conditions to know what you're getting into.
Don't be in a hurry to sign a car loan document, rather take your time
4. Car loan in Nigeria - Everything else you should know
Getting a car loan in Nigeria isn't difficult. You only have to show proof of a reliable stream of income. And if you are working with a reputable company or own a successful business, you stand a better chance of securing a loan for your car.
5. Recent news about car loan in Nigeria
Barely two months ago, Hyundai and Access bankrolled out a vehicle finance scheme for customers in Nigeria. The aim was to inspire folks to buy locally-assembled Hyundai vehicles. The scheme has a 48-month repayment plan which depends on customers' payment options.
There are several car loan plans for brand-new and used car shoppers in Nigeria
A car loan in Nigeria gives you the opportunity to own a car, without putting a financial strain on you. It’s a convenient way to get your own car and pay later. Don’t be in a hurry to get a car loan. Do proper investigations before taking advantage of the car loan services mentioned here. And now, the BALL IS IN YOUR COURT!
>>> Visit Naijauto every day to read more tips on car financing
>>> Also check out other interesting car reviews and car price articles prepared by auto experts!