There are a number of car finance products available that can help consumers to cover the costs of a new car. With car finance you will not have to pay the full sale price for the car upfront out of your own money. This means you can spread the payments over a specified period and this makes it much easier for you to afford a new car.
Getting the Best Deals
It can be confusing to work out which are the best deals on car finance as there are so many different options available. Not only could you fund your new car from a personal loan but the dealer could also offer credit products as well. You will need to look at three main factors when you are choosing credit products to fund your new car:
– How much money you can borrow – lenders can offer many different loan amounts so you should be able to find an option to cover the money you need to buy your new car. Make sure you only borrow as much as you can afford to pay back each month. Always check how much the monthly repayments will be including interest when you are working out how much money to borrow.
– How long the loan term is for – the length of the loan will help to determine how much you will have to pay back each month. With shorter term loans you will have less time to pay back the money so the monthly repayments will be higher. With longer term loans you will have more time to pay back the money and so the monthly repayments will be lower. In general you will pay less interest overall on a shorter term loan.
– How much the interest is on the money you borrow – interest rates, or APR, are very important as this will tell you how much the lender is charging you for borrowing money. In general terms you should be looking for a low APR deal, however the lowest option may not always be the best for your needs. You also need to consider the term of the loan and the monthly repayments as well.
Using Car Loan Calculators
Car loan calculators are essential tools when it comes to choosing the right car finance option. Car loan calculators are available online from websites like Carloanadvisor.co.uk. They offer you a simple tool to work out exactly what you will need to pay back on loan deals. This is a very quick and easy way to compare deals as you can simply input the amount you want to borrow, the loan term and then the interest. The car loan calculator will then work out at just the click of a button how much you will have to pay back overall and also what your monthly repayments will be. This is a very effective way to compare different loan offers to find out which one can really provide you with the best deal.