About Car Financing and Dealer Financing
Auto financing has become big business. A large number of new and used car buyers in the UK This form of bank loans and dealer financing, leasing, credit cards, real Mum & Dad "Bank" or the countless other forms of financing. How to finance the purchase of their vehicle, but relatively few people actually own money, but with more and more car buyers.
A generation ago, for example, a private car buyers usually buy a car worth £ 8000 it would spend £ 8,000 in cash. A car is very easy to apply for funding; If you have a car you can buy, you pay the more you can be in front of the property, but (hopefully) can manage the pieces of time with small monthly. Buy a car, for example, is not a financial pro or anti.
For many people, the car dealer to buy a car is very easy to finance. An attractive option for financing a car through a dealer too many national programs and proposals.
The third with a brief mention of the purchase (HP) and personal contract purchase (PCP), lease: This blog there are two types of financing for private car buyers, car dealerships Purchase Leasing (LP) is concentrated.
HP is like a home mortgage; You pay a deposit in advance, and then a period of time (usually 18 to 60 months), the rest to pay. If, after the final payment, a car, you are officially considered. The car finance for many years as a way to lose, but now in favor of the possibility of PCP.
A lease-purchase a number of advantages. (Deposit plus a number of fixed monthly payments) are easy to understand, and the deadline to meet the needs of the security deposit and the buyer (payments) to choose from. Usually, you can keep the car, if paid after the end of the financial PCP HP will pay less in total.
PCP HP the biggest drawback is usually to pay the cost of the car can be lower, which means higher monthly payments.
HP customers are generally good; their plan to keep the car for a long time (more than the term of the loan) at the end of the contract easy car financing plan, stingless tail, they have a large down payment.
What is a Personal Contract Purchase?
Up HP, pay a deposit and a monthly payment over a period of time. At the same time, lower monthly payments and / or (usually no more than 48 months), no car payment, because the time is short.
This gives you two options:
1) Bring the car.
2) Numbers (GMFV) and to keep the balance of the car. The dealer will take care of payment of Finance and the assessment of the value of the car. Car GMFV car may be worth more than a down payment changes (equity).
Private buyer, a rental agreement or in a product is relatively cheap credit agreement. Each dealer to pay for the financial instrument, and you can conclude the agreement on behalf of your next car is not associated with a different manufacturer or dealer. The disadvantage of a PCP, they contract (GMFV) the desire to avoid large payments at the end of a few years out of the car to change a cycle block. But, almost always with the owner to replace him as he staggers to pay GMFV and generally much less than the cheapest new car a new PCP to borrow money with a monthly payment to keep the car another car. A record was a bit of a hybrid between HP and PCP. If the contract is not a large deposit with the final payment at the end of PCP and low monthly payments.
To read the fine print
Finances, which is important for people to buy a car, read the contract carefully before signing anything, and they him. Many people make monthly payments for the complete dedication of a case, but, then finance a car purchase and error. Many heavy-funded sports cars because of an unexpected pregnancy, often had significant financial consequences for the returns!
As part of financing the purchase of a car, you need all the different ways of financing, and to ensure you make an informed decision about the money, the advantages and shortcomings of various financial products, and be sure to discuss.