Car loans

What to know about car loans

A car loan is meant for buying a new or used car.

It can be unsecured (like a personal loan) or secured with the car, in which case the interest is usually lower.

Compare the APR, the required down payment and the loan term. Some offers include mandatory comprehensive (CASCO) insurance for the loan duration.

• ✓For a new or used car
• ✓Amounts from 10,000 to 250,000 lei
• ✓Terms up to 8 years
• ✓Lower rates on secured loans

Car loan vs leasing: ownership, CASCO, and new vs used

Before comparing car-loan offers, decide between two paths: a classic loan, where you own the car from day one (the title is in your name, possibly with a „pledged to bank X” note), or financial leasing, where the leasing firm legally owns the car until the last instalment.

The practical difference is large: with a loan you can sell the car with the bank's agreement, with leasing you cannot — and changing the continuation option is procedurally harder.

For consumers, the car loan is the usual choice; leasing makes sense mostly for companies for tax reasons.

Comprehensive (CASCO) insurance is nearly always mandatory on car loans, no matter the bank.

The reason is simple: the car is the collateral and the bank wants protection if it's stolen, destroyed, or in an accident.

CASCO is added on top of the monthly payment and can reach 4-7% of the car's value per year, depending on driver age, location, and model.

RCA stays mandatory by law. Credit-linked life insurance is usually optional — ask explicitly if you can remove it from the package.

For used cars, almost every bank caps the vehicle's age at loan end — typically 12 or 15 years.

So for a 5-year loan, the car can be at most 7-10 years old at purchase. Down payment varies: 10-15% for new cars, 20-30% for used.

Standard term is 5-7 years; above 7 it starts to be economically hard to justify — you pay interest on a car that holds less and less value.