Financing A New Car With A Personal Loan

Financing a​ New Car With a​ Personal Loan
Buying a​ new or​ second hand is​ always an​ expensive business and unless you​ are one of​ the​ dying breed of​ motorists lucky enough to​ be a​ cash buyer,​ then how you​ finance your new purchase is​ going to​ be a​ major consideration.
So,​ what are your options?
Basically,​ you​ can look at​ the​ dealer’s own finance schemes (‘schemes’ in​ most cases,​ being the​ key word here!); by taking out a​ car loan from a​ loan provider or​ bank; or,​ by remortgaging.
Car dealer finance
With car dealership finance,​ there are many different types available .​
However,​ in​ most cases,​ they work out the​ most costly way to​ fund a​ new motor .​
This is​ because car dealers are in​ the​ middle men between you​ and the​ finance company who are offering the​ loan and while the​ ‘money’ is​ changing hands,​ the​ car dealer likes to​ take his own little cut.
This will be reflected in​ the​ interest rate you​ are offered by the​ dealership,​ which will in​ most cases be bumped up from what the​ finance company are asking.
And if​ you​ see a​ 0% finance deal,​ while it​ will seem attractive to​ everyone,​ even those who could be cash buyer,​ you​ need to​ ask yourself why they are offering such a​ good deal .​
is​ it​ because they need to​ shift this particular make and model of​ car as​ it​ isn’t selling?
If this could be the​ case,​ what hope will you​ have of​ selling a​ few years down the​ line when you​ decide to​ get another vehicle?
Or is​ the​ 0% finance deal on​ offer because there are hidden extras that will be added in​ to​ the​ overall costs so that the​ dealership stills makes a​ nice little profit,​ which mans you​ are paying over the​ odds for the​ car?
Also remember that should you​ miss your monthly credit repayments on​ the​ car,​ it​ could be repossessed,​ leaving you​ literally stranded.
Do your research thoroughly before signing up to​ a​ 0% finance deal – everything in​ life comes with a​ price tag even if​ it​ is​ hard to​ see.
Personal loans
By arranging a​ personal loan even before you​ set foot inside a​ showroom,​ you​ put yourself in​ a​ much better position as​ you​ will have a​ lot more bargaining power .​
Plus,​ it​ means that once you​ sign on​ the​ dotted line for your new car,​ you​ own it​ completely,​ even if​ you​ do have a​ debt to​ pay it.
Finding the​ cheapest personal loan in​ order to​ finance a​ car can be simple .​
It’s all a​ case of​ shopping around for the​ right deal .​
Of course the​ internet makes this easy for you,​ giving you​ access to​ literally hundreds of​ providers and deals .​
You can compare interest rates as​ well as​ terms and conditions and can even apply online.
Always get a​ fixed rate loan for a​ shorter time as​ possible in​ order to​ know exactly how much you​ are paying out each month and to​ minimise the​ amount of​ interest you​ will repay.
Finally,​ remortgaging is​ another way to​ finance a​ new car .​
However,​ do bear in​ mind that while you​ may be paying a​ low rate of​ interest (mortgage rates in​ general are lower than personal loan rates),​ the​ payment will be spread over a​ longer period of​ time - up to​ 25 years depending on​ the​ term on​ your mortgage.
So,​ you’ll be paying lots and lots of​ interest back on​ it.
You should also ensure that the​ extra repayment is​ affordable .​
Should this extra repayment be a​ burden on​ you​ finally and you​ start to​ miss repayment,​ it​ will be your home,​ not your car,​ that will be repossessed.
Financing A New Car With A Personal Loan Financing A New Car With A Personal Loan Reviewed by Henda Yesti on August 07, 2018 Rating: 5

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