VW bank offers its customers two loans to finance new cars: AutoCredit and ClassicCredit. Both offers differed mainly by the different types of replacement. While the ClassicCredit is a normal car loan from VW bank, the AutoCredit is being replaced by a final installment, which offers various advantages and a higher degree of flexibility. VW bank is a subsidiary of Volkswagen Financial Services AG, which is 100% owned by Volkswagen AG. In addition to special offers for the financing of vehicles, the company offers further services in the area of financing and payment.
ClassicCredit – Classic car loan from VW bank
Essentially, the Classic Credit is a standard installment loan designed specifically for the purchase or financing of new and used cars. It is advertised above all with favorable conditions, which should be expressed above all in the effective interest. The term of the loan is at least 12 months and a maximum of 72 months. At the beginning, the customer makes a down payment, which has a decisive influence on the further arrangement of the conditions.
With the help of such a deposit in general, the conditions in terms of credit rating can be mitigated somewhat. Customers with a moderate credit rating will be given the opportunity to accelerate the approval of the loan through a relatively high deposit. With this car loan from VW bank, it is also possible to give the old car in payment in order to increase the down payment with the resulting income. The once agreed monthly installments remain the same over the entire term, which offers the borrower a good basis for calculation.
In addition to the Classic Credit application for the so-called Credither is possible. This is a residual debt insurance with an extended scope of benefits. First of all, the installment payment or the repayment of the loan is secured. In the event that the borrower loses his job through no fault of his own, the insurance will cover the installment for a maximum of 24 months. If the borrower becomes incapacitated for employment, VW bank arranges ambulance transports and, according to its own statements, looks after the interests of the insured’s family. Concrete facts about financial benefits are not mentioned. On the death of the insured or the borrower, however, a complete replacement of the loan is promised.
AutoCredit – The flexible car loan from VW bank
The biggest difference to Classic Credit is the final installment for this loan option. At the end of the term, it allows the customer several options on how to handle the loan or the vehicle financed. With this car loan from VW bank, it is also possible to make down payments in cash and used cars in payment. Thus, the same advantages as described above can be claimed. The term is Auto Credit between 12 and a maximum of 54 months. Due to the high closing rate, the borrower has more liquidity during the term as the monthly installments are kept low.
The first option for a car loan from VW bank with a final installment is to pay off the final installment with the help of follow-on financing, which will extend the loan’s overall duration. Alternatively, this rate can be paid in full and the loan will be replaced. Thus, the vehicle passes directly into the property of the buyer. The last variant is to return the car. In doing so, use is made of the securitized right of return whereby the owner returns the car to the respective Volkswagen partner. The final installment is then paid by the dealership, while the buyer can choose a new car.