Many people would like to realize the dream of individual mobility as soon as they have found a new job. And then ask yourself if there is a car loan despite annual contract at all and how lenders even react, if only a limited-term employment contract exists.
The entrepreneurial decision on lending is also difficult for a bank, because a single-digit interest rate minus the cost of loan management and refinancing means a historically low tolerance for individual loan loss provisions. Is there still a way to car loan despite annual contract? And if so, you better go ahead:
The slow upgrade of loan
The most obvious way to see bankers and lenders thinking about increasing loan limits and lending. Think about starting your very first job and the consequent granting of the loan line: This is not granted directly after the first salary, but, for example, only after 2 or 3 months with a stable salary.
Car loans in spite of an annual contract, you should proceed in a similar way: Both lenders and all other entrepreneurs know that especially the first weeks of a probationary period are very critical in terms of whether the employee wants to perform the job long-term. So if you want to apply for a car loan despite an annual contract, then you should not start this process immediately after starting work.
Apply for a smaller loan amount with a shorter term
The last ten years have been marked by significant changes in employment law and, in particular, notice periods. That is why it also applies to borrowers who have been working in the same company for a long time: Lifelong employment is not guaranteed. Conversely, for car loans despite an annual contract, the risk to the lender is not much higher than for many companies operating in very volatile and risky industries. But as a borrower you should set further positive signals for the loan: Do not start with the purchase of a new car of a higher category at the beginning of your career.
If you are on the road with a used car at first, you have many advantages: You can keep the repayment period relatively short so that it does not significantly exceed the first-time duration of your employment contract. In addition, monthly payments are lower than for new vehicle financing – leaving more money left over from the monthly budget surplus.
So if you keep the vehicle price or the loan amount low and pay attention to the amount of monthly installments and the term of the loan nothing stands in the way.