If you are in the market for a new car, whether as a brand new car as a first time driver, or as an upgrade to your existing car, there are a few options available to you in how you finance it. One of the options is to of course pay for the car outright, thought for the vast majority of people this just isn’t a feasible option. What should you be looking for when it comes to financing a car loan?
There are many different ways in which you can apply for personal finance. There has been a real shift in reputation and perception of payday loan companies for example, and they can be a great option when you are searching for a short-term solution to your financial requirements. Aside from payday loans you can also find financial and credit solutions through a credit card company, through a mortgage lender, or with other short-term loan companies, depending on your requirements and desires.
For car financing specifically, there are a few different routes you can take, and you should always look at a few different options and pick the route that is most comfortable for you and leads to the best outcome. How much should a car finance loan cost you overall, and how easy are they to apply for?
When you are in the mind-set of choosing a car finance loan solution, here we have put together the viable options open to you. The first is to look at an unsecured personal loan. This is where you know exactly how much money you require to purchase the car you are looking to purchase. It is formatted in the same way as other types of personal loans. You’ll have set monthly payments to make in order to pay off the loan, including all fees and interest in these payments. This ensures you can own your car outright from the very beginning, and provides you with the option to sell your car prior to the end of the personal loan agreement.
A personal contract purchase agreement is another viable option when purchasing a car, and with this option you pay off the cars depreciation value. At the end of the agreement you can either return the car, choose another personal contract purchase, or choose to pay off the rest of the car value. Another option is to take out a hire purchase on the car of your choice. This works in a similar way to a personal loan, making payments each month, but you are making monthly payments to the car finance company. The company own the car and lease it to you over the agreed term.
The type of loan you choose to take out for car finance will come down to your personal preferences and financial situation. You’ll pay a lower monthly repayment with a personal contract purchase, as you are not paying for the car itself. It all depends on what you are willing to pay and what you want from the eventual agreement once the car finance period is over.