Car finance basically refers to all the different financial instruments that enable an individual to get a loan, such as car loans and lease agreements. These financial instruments are used in order to provide people with a way of getting a car without having to pay for it upfront. In the past, financing was quite difficult because lenders almost never lent money, but these days they are more willing to lend because of the growing number of car accidents.
The most common car finance types are personal contract purchase and secured loan. A contract purchase is where the buyer has to take care of repaying the loan each month until the full amount has been paid off. The loan can either be taken out under the form of a personal contract or a secured one. If the loan is taken out under a personal contract, then the interest rates are usually the lowest in the market. However, if it is a secured loan, then this interest rate is usually higher than what you would find in the market.
Another type of car finance is the used car finance. In this case, the buyer of the car buys it from a dealership or a finance company. The dealer finance companies do not actually provide the cars directly, rather they will make the car available to the buyer. While selling the vehicle the dealer finance companies will take care of all the paperwork and take care of the monthly repayments. However, since the dealer finance companies make the cars available to the buyer, they have lower costs.
Another kind of dealer finance is the new car purchase loan. The way this works is that the buyer of the new car will have to pay for the entire interest cost of the car before the car is purchased. This interest rate is normally much higher than what you would find in the market. This is due to the fact that the lender is taking on the added risk of giving the new car away. This also means that the lender will charge a slightly higher rate of interest. If you want to get a lower interest rate on your new car purchase then you can look at getting quotes from the various new car purchase loan providers.
There are some dealerships which offer used car finance. However, since these dealerships specialize in used cars, they may set their interest rates much higher than the normal rate for a dealership. However, even if you get a quote from a used car dealership then it will not be as good as quotes you could find elsewhere. These quotes will be for the wholesale price of the used car and therefore will not include the trade-in value if there is one.
One of the most popular forms of dealership finance is the personal contract purchase or PCP. The personal contract purchase is a type of loan where the buyer of the vehicle is fully committed to pay the monthly repayments for the full amount. The great thing about this type of car finance is that you can pay the monthly repayments on a monthly basis that suits you, not the dealer.
The benefits of a personal contract purchase are that there are no monthly repayments like with a PCP and you do not have to enter into any binding agreements. However, with a PCP you have to commit to the repayments for the full amount over the course of the loan. You will also have to prove that you have enough income to support yourself during the period of the loan until you pay off the loan.
If you have a good credit score and wish to apply for a dealership loan you should go with a well known lender. The best way to find these lenders is to use an online finance company. A good website will allow you to apply from the comfort of your own home. They will gather all the required information and then match you with compatible lenders. Once you have been matched up with suitable lenders you will be able to apply online and this can save you time and money. You will be able to see immediately whether an auto loan is available through your chosen lender or not.