For a loan to buy a car in Luxembourg, the rates can go from simple to double...or even triple! What's more, they often change: most car loan rates doubled in the first half of 2022 due to the economic situation (inflation, rise in key rates).
If you are planning to buy a new car, we strongly advise you to compare car loan rates before you start. You can save a lot of money on your loan.
There are several reasons why you might want to borrow money to buy a new car:
If you want to buy a new vehicle, The car loan is therefore a good solution to avoid having to pay a large sum at once. However, this comes at a cost: you will have to pay interest to the bank. That's why it's important to compare interest rates before signing a car loan.
In Luxembourg, the average loan rate varies much more than in neighbouring countries (France, Belgium, Germany). Nevertheless, it is not particularly lower or higher: it all depends on the time of year and the economic situation.
There is a major difference between a car loan and a lease. If you take out a loan, you own the vehicle. If you take out a lease, you rent the vehicle: you sign a rental contract. Here are the main differences:
In the end, it all depends on what you want and how you use the vehicle:
In Luxembourg, you can benefit froma bonus for the purchase of an electric car. And if you want to buy the latest Tesla, Volkswagen ID, Audi e-tron, BMW i3 or i4, don't forget to tell your bank. They will be able to offer you reduced interest rates that are dedicated to green projects. This means that the cost of your credit will be lower than if you were to buy a combustion car (petrol, diesel) at an equivalent price.
Interest rates for car loans vary regularly in Luxembourg, depending on the economic context. We advise you to regularly consult our selection of offers to find the best rates.
The banks BIL, BGL, Raiffeisen, ING and Spuerkeess offer car loans. They offer very attractive rates for their customers and for young people under 30.
The lowest rates for a car loan can be found between 2% and 3%. However, these rates are reserved for particularly creditworthy people. If you have a good financial situation, a stable job, and low debt, you could benefit.
If you are on a fixed-term contract, on work experience, unemployed or self-employed, apply for a loan and ask the bank for advice. Depending on your situation, they will be able to find a solution to grant you a loan with sufficient guarantees.
Simply apply for a car loan online with the bank that offers the best rate. The bank advisor will then contact you to sign the loan and release the funds. You can buy your car quickly!
Here is the formula to calculate the cost of your car loan: cost of credit = monthly instalments x loan period - amount borrowed
You can also simulate a car loan via the "car loan calculator" of the bank of your choice. Almost all banks in Luxembourg have a tool that allows you to simulate the cost of your credit, or at least the monthly payments.
Car loans generally run from 12 to 60 months, i.e. from one year to five years. How long you choose depends on the amount you borrow and your income. A tip: do a simulation with the bank of your choice, and choose the duration of the loan according to the monthly payment that suits you best. The shorter your loan, the cheaper it will be, but the higher your monthly payments will be! The best term depends above all on your financial situation and your current level of debt.
To get a car loan, simply apply to the bank of your choice. Start by comparing car loan offers on our comparison table, then go directly to the website of the bank of your choice. The bank advisor will then ask you for some information and proof (such as your employment contract, pay slips and proof of identity) in order to draw up your loan contract.