The consortiums are known for offering the possibility of buying goods and contracting services of various types, from real estate and vehicles to dental treatments. This is possible through contemplation, which entitles to a letter of credit that allows the acquisition of the good or the contracting of the desired service.
But what must be done to buy car with letter of credit? This is what we will clarify in this post. Keep up!
How does the letter of credit work?
THE credit letter corresponds to the value that the consortium member has to make the acquisition of the good or the contracting of the desired service. It is released after contemplation, which may happen by lot, bid or at the end of payment of installments.
What can be purchased?
After contemplation, the interested party can acquire any good or contract any service that belongs to the category of the consortium of which it is part. According to the Central Bank, there are 3 categories of consortia:
- services: travel, events, renovations and medical and dental services;
- real estate: any type of real estate, including land and apartments on the floor;
- movable goods: any kind of motor vehicle.
So anyone who wants to buy a car with the letter of credit must be part of a consortium included in the movable property group.
How to buy car with letter of credit?
After contemplation, you need to take a few steps to finally get your hands on the keys of your new vehicle. At first, informing the consortium member of the contemplation, the administrator will request the necessary documents for the release of the letter of credit.
The consortium member may not have the name included in the credit protection services nor be the arrears of the consortium late at this time, otherwise he will not be able to complete the process. Therefore it is important to always keep the regular situation, avoiding delays.
With the letter in hand, the recipient of going to the dealership of your choice to choose the vehicle, with complete freedom. Simply make the communication to the administrator, as stipulated in contract. Closed deal, the administrator will transfer the amount to the seller, making the payment. At no time does the money go through the hands of the consortium member.
Is it possible to buy a used vehicle?
Nothing preventing a semi-new car or used to be chosen to be purchased with a letter of credit. However, some conditions need to be met, which varies by administrator. It is common, for example, that companies limit the year of manufacture of the vehicle, making it impossible to purchase very old cars.
And if the letter of credit is less than the value of the desired vehicle, the consortium member can, without problems, complete the difference with their own resources.
If the opposite happens, if the letter of credit is higher than the price of the vehicle, the remaining money can be used to cover transfer and documentation expenses (limited to 10% of the total letter), repayment of outstanding consortium installments or return in kind, provided there is no backlog by the consortium member.
Now that you have discovered that it is possible to buy car with letter of credit, what are you waiting for to realize the dream of the new automobile?
Finally, if you want to know all about consortiums, enjoy downloading for free. this ebook to understand well what a consortium is and how it works!