When you want to buy a car, it not a simple decision that you will make. However, there will many options of finance that you will choose. Besides, don’t remember that you will also consider running costs. If you don’t know, a car will be the second thing that will be most expensive after a home and check with an online car loan calculator.
It will, therefore, be essential to choose the best ways of buying a car.
- Hire Purchase to Buy a Car
Hire purchase can be a method of purchasing a car. It is an essential way of financing your car and the loan will be secured on your car. However, you will also need to ensure you have deposited more than 10 percent and continue paying a fixed monthly amount for a certain period of time.
These hire purchase agreements will be arranged by the dealer of the car. It will be essential to buy competitive cars.
- What Will You Use To Buy The Car, Savings Or Cash Amount?
It will be essential to start with the car cost calculator to know the total cost you need for monitoring. For you to buy a car, the cheapest way will be funding it all or part it in cash. The reason is that you will pay interest on finance agreement or loan.
In case you will buy the car with cash, make sure you will be having enough savings and remain some for emergency after paying the car. However, if you won’t have enough, then deposit the biggest amount you have.
- Leasing – Personal Contract Hire
In this method, you will pay the dealer his fixed monthly amount so that you can use the car. Here, you will be including maintenances and servicing of that car but the mileage won’t exceed the specified limit.
After the agreement comes to an end, you don’t have to use the car anymore. You have to return it because it wasn’t belonging to you.
- Personal Loan
If you need a loan to purchase a car, you can get it from the building society, financial provider or the bank. However, you have to ensure you have a good credit rating. When you take the loan, you will also be able t spread it from one or more years.
However, ensure that you don’t secure your loan against the home. If you will put it there, you will be at high risk of losing the home if you don’t repay the loan.
- Credit Card
If something will go wrong, then paying the car with credit will give you extra protection. It will also be better in case you can pay a monthly amount with your card. Besides, don’t forget that dealers will also charge a certain amount as the card handling fee. However, some car dealers might not accept payments with the cards.
It is essential to have good credit so that you can get a better rate. If you miss some amount for payment, it will be affecting your credit rating. However, even the interest rates will also depend on your credit score.