The vehicle secured loan is a lower interest credit option. Also called vehicle refinancing, the alternative has become a great option for those who want to repay a debt with higher interest rates or have a smaller amount, with faster repayment. Learn more about the option, and the documents required to successfully join the operation.
How a Vehicle Refinancing Works
Lower interest rates require more planning. This sentence sums up the idea of refinancing vehicles. This is because, in the option, the customer offers his vehicle as collateral for the loan requested.
By placing the car as a credit security with the finance company, the consumer gives it power over the vehicle. Even if still in the name of the individual, the car now has a “joint tutelage” that will give the bank the authorization to appropriate it.
This situation will only happen in extreme cases where the client fails to repay the loan installments. Before acting, the operator may try to renegotiate the values. But if this reconciliation did not work, it could take the owner’s good, auction it, and use the values to repay the individual’s debt.
Put on balance, vehicle refinancing interest rate and other loans are very different.
Even with this risk in contract, refinancing is a very advantageous option. Their interest rates are lower than financing or other traditional forms of credit, and bring repayment terms of up to six years.
In some operators, the credit granted can be up to 90% of the car, established based on the Table Fipe, the Institute of Economic Research Foundation. The index sets the buying and selling value of new and used cars.
Required Documents for Membership
To take advantage of a vehicle refinancing, you need to present to the credit company some personal and auto documents offered as collateral.
General Registration (RG)
The age of those who can take out a secured loan varies by financial. Most, however, set the minimum age of 18 years. The document will also serve to record all information of the loan applicant.
Register of Physical People
The CPF is unique to each individual and identifies it with the IRS.
Proof of address
This document states the customer’s home address and facilitates the submission of possible charges.
Proof of income
The registration will certify to the credit provider your financial condition of repaying the debt you are getting with the loan.
For refinancing, documents such as CRV and CRLV are required.
Vehicle Registration Certificate (CRV)
The document features all the car’s characteristics, such as license plate number, year and model, chassis and fuel type. It is essential in credit operations, buying and selling the vehicle.
Vehicle Registration and Licensing Certificate (CRLV)
The CRLV is the License that allows the driving of vehicles through the streets and roads of the country.
IPVA Certificate of Payment
The statement proves the payment of the mandatory annual tax on the Motor Vehicle Property Tax.
Some financiers may also apply for the client’s National Driver’s License and birth or marriage certificate, and the Single Vehicle Transfer Document (DUT). When hiring credit, then, it is important to pay attention to the statements requested by the bank.
Want to know more about vehicle refinancing? You can read our articles about the best rates in the country. Visit our blog and check it out.