GE Money is raising its profile in the New Zealand car loan market.
From Monday, August 5, it will be offering to do car loans at 11.99% p.a. This is down from the 15.0% rate it uses in its online car loan calculator.
All loans are subject to GE Money's credit and lending criteria, and fees apply, including their $275 documentation fee.
The new promoted rate is for car loan 'secured' against sufficient assets, which may include the vehicle purchased, and which will depend on the level of equity in the vehicle transaction.
Their 11.99% rate expires at the end of October 2013.
"Interest rates and actual repayment amounts will vary depending on a number of factors including amount borrowed, security offered, deposit paid, and applicant's credit rating," they say.
An 11.99% car loan rate would make it competitive with the benchmark AA Finance car lending rates which are currently priced from 10.95% to 14.95% depending on the value of the loan amount. AA Finance's loan documentation fee is $425. AA Finance loans are supplied by "MARAC Finance" a division of Heartland Bank.
You can see all current car loan offers here.
GE Money withdrew from the New Zealand car loan market in October 2008, but have since re-entered the market and are back active and working as an exclusive car loan provider with Trade Me.
GE Money also recently entered into a credit card venture with Countdown. It has a major presence in retail finance via its GE Creditline programme, and is active with its GEM Visa programme.
Major car leasing business CustomFleet is also part of GE Capital.
Recently GE Money said it is looking at the possibility of raising retail funding in New Zealand.
3 Comments
The normal interest rate for GE loans, GE Cards, Gemvisa etc is normally 24 - 27% - locked into a 1980s view of consumer interest rates.
So 11.95% in NZ is a major break through for this company.
Maybe not so many people lining up for 25% loans any more?
Maybe too many NZ viewers watching the Suze Orman show etc envying those American car buyers with finance at 0%, or 2% or 3%. Dangerous when you show people that NZ still has the highest interest rates in the world - suppressing the ability of small businesses and farms the ability to borrow at reasonable rates to grow their businesses.
It seems to be GE policy that Personal Loan holders of GE do not receive monthly statements, or annual statements or any online information on their loan as they repay it. So customers must trust that their monthly direct debits are correctly calculated & that their final payment does officially complete all obligations. I have seen a number of people in this situation - so they must ring GE on an adhoc basis to ascertain their balance / or request a written statement at a cost. It seems a bit strange in this day of online or regular statements. Even a Farmers Card will send their customers a monthly statement. Hopefully, this is a cost saving measure & not an attempt to keep information from people deliberately. By comparison MTF - give their customers online access so they can see their payments acknowledged & so the ability to see themselves paying down the sum borrowed. This is important also when people are borrowing, say, for a house & need to collect all info on their consumer debt - if they don't get a statement then it is unlikely they will use a spreadsheet to calculate their own amortisation formulas.
Possibly GE are sticking to the letter of the Law which does not require them to actually update their loan holders with monthly statements or online access to the loan balance/repayments. However, it would seem good practice to keep customers informed throughout the loan repayment period - regularly.
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