Financing Your Next Car
If you are planning on buying a new car, getting one on finance may be a good option. Of course, the current economic climate may limit your options to a certain extent. However, there will still be plenty of choice available, so let`s see how to go about securing one.
Take a Look At Your Credit Report
Before you even start looking at any deals, the first thing you should do is take a look at your credit report. These can be accessed online through a number of different companies and you can have one free report every twelve months (a small fee will be charged for further reports). This credit report will ultimately determine the kind of finance deal you may be offered and it will be to your advantage to know where you stand before you start.
Calculate How Much You Can Stretch To
Essentially your calculations will need to include not only the monthly payments, but also the down payment you will, more often than not, be required to pay. The important point here is to be honest and realistic. There is no point in entering into a deal that is a little outside your means. Otherwise, you will soon find yourself behind with the payments and may even end up having the car repossessed.
The Loan Period
The next thing you will need to consider will be the length of the loan period. For the most part, you will find that the loan period will be from between five and six years. However, perhaps due to the current economic climate, many companies are choosing to offer significantly longer loan periods. Naturally, the longer the loan period, the lower your monthly repayments are going to be. Of course, with a longer period you will end up paying more in total.
There are also considerably lower period loans available, which are generally around 36 months. These will usually have very low interests rates. In some cases, they may even offer a 0% interest rate. Whilst your monthly payments will be much higher, you will be paying far less in total for the vehicle and it will be all yours so much sooner.
Examine the Small Print
There will no doubt be a few related costs that may considerably influence how much you will, in reality, be paying. These can include factors such as repair and maintenance costs, insurance coverage, licensing fees and projected fuel costs. There are a few price calculators available online that allow you to ascertain the total costs (generally over a five year period) of each specific vehicle.
Research the Options
Finally, you can look at exactly from whom you are going to get your finance. The options here, whilst there are a few alternatives, will generally come down to either your bank or the car dealer themselves. Make sure you do plenty of research (some good sites here include simplyfinance.co.uk) in order that you can see all the various options for yourself. In addition, ensure that you read all the terms and conditions properly because there is likely to be a few hidden complications. In short, knowing all the ins and outs of your finance deal before you enter any showroom will not only facilitate matters, but will also mean you will be in control of the whole proceedings.