What is the credit amount?
The credit amount refers to the total sum of money provided by a lender when purchasing a car with a personal loan. It basically represents the amount of borrowed money, excluding interest and additional fees.
How is the credit amount determined?
The credit or loan amount is determined by a simple formula:
total car price - down payment = credit amount
However, depending on a person's credit history and budget, the credit amount may be limited to a certain ceiling in order to avoid the risk of over-indebtedness.
Note: If you take out a personal loan to buy a car from Gowago, the minimum loan amount is CHF 10,000 and the maximum loan amount is CHF 100,000.
Credit amount vs. total cost of the private credit
The credit amount is just the actual financial amount borrowed. However, the total cost of the loan is slightly higher. It includes interest. That is why the total of all monthly instalments over the term of the personal car credit is higher than the pure credit amount.