Finance Loan » Finance Options

Tips to Follow When Considering Guaranteed Car Finance

Sat, 28 Nov 2009 13:32:09 +0000

Guaranteed car finance may be one way you are able to obtain a loan to buy a new or used car if you have a poor or bad credit rating. It may also be a suitable choice if you have no credit file or you are having trouble obtaining credit due to self-employment.

· Stretching out the loan – if you want to keep down the monthly repayments of your loan then you may be tempted to stretch out the borrowing over a long period. The downside to this is that the car costs more as you are paying out more in interest. Therefore, you may want to give a great deal of consideration as to how long you do take your loan over.

· Paying something towards the car – are you able to put money towards the cost of the vehicle? If you have some money for a deposit, you may have to borrow less and so pay less in interest.

· Comparing loans – just because you have struggled in the past to obtain credit it does not mean that you jump onto the first loan that you are offered. The interest rates that come with a guaranteed loan are usually above the average rates that you may expect to pay if your credit rating is poor. They may also vary a great deal with lenders. If you choose to compare finance options with a specialist motoring website who also sells used cars then you may be able to get a suitable loan.

· New or used car – new cars may cost thousands of pounds more than if you were buying a used car. There are many excellent quality second hand cars on the market so you may want to ask yourself if you really need a new car or if a good used car might suffice. If so, you may have to borrow far less than if buying a brand new model.

· Be aware of penalties – when taking out guaranteed car finance be aware of any penalties that may be included in with the loan. For instance, if you are able to repay the borrowing much earlier than anticipated, there may be a lump sum penalty to be paid.

By: Louis Rix

Get The Right Car Finance

Sat, 03 Oct 2009 12:10:53 +0000

These days when you step into a car showroom, there will be two major things that the dealer will be offering you. First he will be offering you cars, and secondly he will be offering you finance packages. This is how you should look at it. The fact of the matter is you may probably wouldn’t buy a car from your bank, even if they started offering them, so you may wish to apply the same scrutiny to the finance packages available at the car dealership and choose to buy only you car there and the finance package elsewhere.

It may be that there is nothing wrong with the finance being offered at the car dealership and in many cases this will be true. However, you must be aware that just because you buy your car there, does not in any way imply that you have to use the finance options and terms that they are offering. You are always free to take a loan from somewhere else, such as a bank, and pay for the car outright, and then simply make the loan repayments to the bank as with any other loan.

You should be careful to find out exactly how much you are being charged for car finance. The primary way to calculate the charge of any credit is by using the APR or annual percentage rate. This calculates the cost of the loan using a standardised formula and all lenders must use the same method of calculation. However, just because a car dealer’s APR looks attractive does not mean your search is over. You should also, always find out how much the car would cost if you paid in cash. Remember that providing a cash discount is exactly the same as charging extra for credit. If the cash price is lower, then you may be better off getting the loan from elsewhere and paying for the car with cash, this will take advantage of the better price and you will have a smaller amount to pay back to your lender.

The other thing you should look out for is down payments and closing payments. These are payments that are paid at the beginning or end of the term of the loan, and while the monthly payment terms may be attractive, it could well be the case that there are large additional payments to make and you should not forget to calculate these in when pricing the finance.

Car finance can be almost as important as the deal you get on the car itself and you should always regard getting a good deal on the financing as part of the process of getting a new car.

By: Joseph Kenny

All About Car Loan Finance Options

Wed, 16 Sep 2009 20:01:57 +0000

Buying a car has always been a sort of milestone in people’s life. Most of us tend to remember incidents that happen as “before I got the new car” and “after I got the new car”. It also has always taken some planning to accomplish everything necessary to taking the much-anticipated step of driving your new car home for the first time. Unless you are in that very small percentage of people who are able to walk into an automobile showroom and pay cash for a brand new car, you are going to have to arrange for financing in order to get that car, be in brand new, or just new to you.

Getting a car financed brings to mind different thoughts and images than it used to. Of course, you can still procure financing in the “old fashioned” way. You can head over to your bank or credit union, and get your car financed that way. Alternatively, you can go to the car dealership where you plan to buy your car, and allow them to handle everything that needs to be done toward financing that car you have dreamed about. Nevertheless, in today’s world, the most popular option for auto loan financing is online.

What is so special about taking care of your car loan finance needs via the Internet? First, it is easier. Instead of having to make multiple trips to the car dealership, the bank or the credit union to get the car you want to buy financed, you can do everything in the comfort of your home or office. You can search the web for the best interest rate on a car loan at any time of the day or night, at your convenience. What could be easier than that?

As you are searching online for the best car loan financing, keep in mind that you only want to do business with a loan company that is reputable. Of course, that’s a given, as no one would deliberately give their personal information to a company that seems to be a bit on the shady side. You would be surprised at how many people see a too-good-to-be true interest rate, and jump at the chance to get in on it, however. They are only thinking about getting a car as cheaply as possible, without considering the repercussions of taking out a loan with a business that may not even exist except on paper.

There are several ways that you can make sure the online lender you will deal with is one you can trust. Your research is a big help, as it will help you to understand what a genuine lender’s web site looks like. If you do not see any way you can get in touch with an online lender, such as a telephone number and address, do not consider the company. Only deal with online lenders that can prove they are reputable businesses, and who will also keep your personal and financial details confidential and protected from hackers.

Your options for financing a car loan are many and varied. Learn to separate the wheat from the chaff as far as lenders are concerned, and you will soon be driving home in that new car.

By: Todd Bertshinger

Understanding Auto Loan Finance Options

Sun, 06 Sep 2009 22:53:21 +0000

Until relatively recently your choices for obtaining an auto loan or auto finance were limited. You could take out a personal bank loan or you could take out whatever finance the dealer would offer – usually hire purchase. As there was so little choice in types of finance there was relatively little competition and charges and interest rates could be very high.

Nowadays things are different. There are thousands of lenders and dozens of innovative finance packages for your auto purchase. You can get finance from almost anywhere on the high street and there is strong competition for your business between the banks and credit brokers. You can now shop around for the best auto finance deal and haggle on terms until you get the best value for your money.

Dealers also know that financing has become a major factor in most people’s auto buying decisions. If a customer doesn’t like the finance available from one dealer she is quite likely to walk out and buy that new car with a dealer who can offer a better finance package. With 2 or more offers of finance customers are in a great negotiating position. Consequently, auto financing is becoming ever more competitive.

Another well established trend is for the major auto manufacturers to offer very strong finance deals. Manufacturers will also often create auto finance bundles that might contain insurance and a number of years maintenance or extended warrantries. Some even offer free fuel for your first 12 months of motoring. While there can be some great offers from auto manufacturers the mass of extras they often include can make it difficult to see just how good the deal is for you.

A further set of options that are becoming much more popular are lease plans. Once the preserve of the company car driver auto lease plans are becoming ever more diverse and cater more and more for private owners. Look for a personal lease plan.

Lease plans have 2 great advantages: firstly, they keep the cost of the upfront payment low; secondly, they keep your monthly payments low. But you don’t get anything for nothing in the finance World. Lease companies can only keep the upfront and ongoing fees low by retaining ownership of the vehicle. At the end of the lease term you usually have an option to purchase the vehicle at a price agreed at the onset of the contract. Alternatively, you can trade in the vehicle for another – any difference between the agreed value of the old car and it’s actual market value can be used as deposit against your next vehicle.

Lease plans seem to appeal to people who like to be seen in the newest auto models, who never want to own the vehicle and who don’t care that they will be paying a set fee for that privilege every month for ever.

In general the cost of finance in a lease agreement compare pretty well with other sources of finance. Where they can get expensive is if you exceed the mileage limits in your contract. Payments for excess miles can be pretty high.

Another trend, and one which should be treated with caution, is to raise money by refinancing your home. The chances are you will obtain a good interest rate – probably better than for any other sort of loan. But what the advocates of home loan refinancing always seem to forget to tell you is that the amount of your auto loan is added to the total outstanding capital. You will continue making payments against that amount for the whole of the life of your mortgage.

If you then want to get a new auto after 3 years or so do you add to the outstanding capital again.

As you can see, the range of finance options for your next auto purchase is pretty big. Your biggest challenge is finding the loan that best meets your needs.

By: Keith Longmire