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The Three Main Types of Credit Car Loans Currently Available
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Posted On :
Aug-08-2011
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Article Word Count :
481
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Buying a new car is a luxury many people cannot afford out of their own pockets. However you could afford the car you have always wanted with credit car loans.
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Buying a new car is a luxury many people cannot afford out of their own pockets. However you could afford the car you have always wanted with credit car loans. There are many options when it comes to credit car loans. This means you should be able to find a product that suits your requirements.
To assist you with finding the right credit car loans for your needs here is just a quick overview of the three main options available.
1. Personal Loans
A large majority of consumers will take advantage of personal loans at some point in their lives. This is a relatively easy way of borrowing between £1,000 and £25,000 for large purchases such as new cars. Personal loans are available from most of the main banks and building societies. Many providers have tightened up their lending restrictions on personal loans so this may not be as flexible as some of the other types of credit car loans available.
2. Hire Purchase Plans (HP)
Most people will have heard of Hire Purchase plans. These are ideal types of credit car loans for beginners as they are very straightforward and easy to manage. You will need a deposit in most cases when taking out an HP agreement. The amount you have to pay for the deposit will depend on the lenders. Normally though it will be around 10% of the total cost of the loan. You can set up HP agreements with local dealers which is useful if you already have a good idea about what model and make of car you want to buy.
3. Personal Contract Plan (PCP)
This can be a good option if you have a deposit already saved up. By paying a deposit up front you will then have lower monthly repayments which are much easier to manage. At the end of the plan term you will have 3 options available to you. The first option is that you can pay a final amount (balloon payment) so that you own the car outright. The second option is that you can hand the car back to the dealer (if it is in good condition) and walk away. The final option is only available if the car’s value is higher than the remaining amount you have to pay off. You can then use the difference to put as a deposit on your next car.
If you are unsure about which type of credit car loans to look at then you should seek professional guidance. There are a number of loan advisory services available. They will be able to take you through the different credit car loans available and what implications they might have on your finances. It is a good idea to talk to your motor dealer to make sure you get the right loan for your circumstances.
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Article Source :
http://www.articleseen.com/Article_The Three Main Types of Credit Car Loans Currently Available_72065.aspx
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Author Resource :
Credit car loans are widely available and are usually quite quick and easy to apply for. There are several main products on the market that can offer borrowers an effective way to afford a new car.
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Keywords :
Credit car loans, Credit Card, Carlyle Finance, Car Loan Adviser, Motor Finance, Car Loan Calculator,
Category :
Finance
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Finance
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