Get a Cool Car with Easy Finance Help

Getting a new car on finance is one of the best options. There is no need to worry about affording the full total from your own money and, with some options, there’s no need to pay for the full car in the end if you choose you do not want it. Here are some options for car finance.

Unsecured Personal Loans

A bank or lender will be able to offer personal loans, which can be used to buy a car. You will need to state the reason for the loan upfront, so some lenders may require that you take out a secured loan instead; where they have the title of the car until you make the final payment. Most banks will only allow you to borrow up to £10,000 in unsecured loans and offer up to 10 years to pay the money off, which is enough for many second-hand cars.

The problem is it is much harder to afford newer models as many are over £10,000. However, that one problem is overshadowed by the fact that there is no deposit required, you can gain the finance within 24 hours from many banks – depending on the way that you apply – and pay a much lower rate of interest.

Hire Purchases

A hire purchase is usually gained through the car dealership and is one of the simplest options when it come to financing a car. You pay about 10% of the total car amount and gain a loan for the rest. The remainder is paid through repayments agreed on when signing the credit agreement.

However, you will not owe the car until the last payment is made. It means that you sell it on or make any modifications – even for security reasons – without the permission from the lender. If you default on payments, they will be able to take the car back but you have to pay the interest. However, the benefit is that you do not need to make the last payment. If you choose not to have the car in the end, you just need to pay for any extra mileage and repairs that need to be made.

Leasing

If you want a new car on a regular basis, leasing is possibly the best option for you. You never get to own the car so you cannot make modifications but you do not need to worry about mechanical problems or breakdowns as many companies offer maintenance for a little extra. 

The main downside is that the payments are usually much higher than those who opt for traditional car finance. You will also need to have fully comprehensive insurance to cover any damage, which is much more expensive for the newer models.

0% Finance

There are deals to gain 0% interest on car finance but this is only available for those who can afford a high deposit. You will usually need to pay about 40% of the car’s total to gain a 0% finance deal. You will need a good credit rating. The only way that you will gain a 0% finance deal is if the lender believes that there is a lower risk.

The biggest drawback is the fact that the monthly payments are likely to be much higher than with other car financing options. The length of the loan term is usually shorter, which increases the payments, but there is no interest on that loan. This is not available for all vehicles.

There are many options for car finance to afford a brand new car. Take your time to look through the options and assess your needs. 0% finance deals are great for those who can afford a larger deposit but leasing is best for those who want a new car on a regular basis.