If you want to trade your old car in for a new or upgraded pre-owned vehicle in the UAE, you'll likely need to take out car finance. A vehicle is usually the second-most expensive investment you'll make after your property. Unless you have a large amount of savings or disposable income available, you will need to arrange a car loan to be able to pay for your vehicle. But how do you choose the right car finance deal? And what is available?
The hard way – arranging finance yourself
Car loans are mortgaged to a lender or, more often, a bank. While it’s easier to talk to your current bank, you don’t have to get a loan from the same bank that you have your account with. If you find another bank offering a better deal on car finance loans, you can talk to them to arrange a separate deal.
You'll need to meet specific criteria, including being over 21 years old. The finance provider or bank will ask for a set of documents before considering you for a loan, including a salary certificate, at least three months' bank statements, an Emirates ID and a full driver's licence. If you are buying a used or pre-owned car, they may also want to see an authenticated valuation certificate or a quote from a dealership on the price of a new car.
You’ll also need to be earning a minimum salary of around AED 3,000.
All of that can take some time to arrange - and you'll also need to provide a down payment of around 20%, as a finance lender will usually only provide you with a loan to cover 80% of the cost of the vehicle.
The easy way – get the dealer to arrange it for you
Rather than trying to arrange finance yourself, you can ask your dealership to do it for you. Most larger dealers have an existing arrangement with a bank to accommodate loans, although you'll still need to provide all the documentation and the deposit to proceed.
Once your loan is arranged, you’ll repay it in Equal Monthly Instalments, or EMIs. This makes it easier to budget, as you’ll know exactly how much you’ll pay, including interest on the loan.
The Lexus alternative – flexible and hassle-free
One disadvantage of car finance in the UAE is that it's not always very flexible. Once you've paid the loan off, the vehicle is yours - then you have to decide what to do next. If you want to upgrade to a newer pre-owned, or even a new car, you have to go through the same process all over again.
Lexus Solutions challenges the idea that there's only one way to finance a vehicle by offering a variety of deals focused around you. It provides flexibility and a hassle-free way of buying a car in the UAE while providing you with a Guaranteed Future Value. This means you'll know exactly how much your Lexus is worth when your contract ends and how much it will cost you to upgrade to a newer model if you wish.
How it works
Choose the Lexus you want to drive. We’ll set a Guaranteed Future Value amount based on the terms of your agreement and the number of kilometres you plan to drive every year. Choose a two or three-year contract, and make your deposit.
You’ll pay a lower monthly amount and enjoy financial flexibility without the usual hassle of arranging financing. The Guaranteed Future Value gives you total peace of mind, and you get to drive the Lexus of your dreams.
When your agreement period is up, you have three options. You can either:
Car finance in the UAE is changing. It’s becoming more flexible and more focused on the consumer. The result is that having a new Lexus sitting on your driveway has never been easier or more affordable. Find out more and book a test drive by contacting Al-Futtaim Lexus today.