There are many different types of borrowing out there when you start to look into ways of financing to buy a new car. With this in mind you have to consider all your options and which might be the better deal for your needs. A specialist motoring website will allow you to do this, they will provide you with the information needed for you to make a decision and then you will be able to get quotes to compare.
Walking into the showroom with the money in hand is one of the best ways of being able to knock something off the cost of the car. Taking either a secured or unsecured loan to finance your car is a very popular option for buying either a new or second hand car.
If you need a large sum of money for a brand new car then consider looking into a secured loan. This type loan would allow you borrow more than a personal loan would and the repayments can be spread out over a longer period of time. The rates of interest are also lower than they would be with an unsecured loan. However the longer you take out the loan the more you will pay in interest. Another downside to the secured loan is that you will have to put something up as security against the loan. If you put your home up as guarantee against the borrowing then you are at risk of losing your home. Therefore it is essential to make sure you could afford the repayments and to bear in mind that your circumstances could change in the future.
An unsecured loan with come with higher interest rates than the secured, however the bonus is that is does not require you to put up something against the money you are borrowing. This could be an excellent option for those buying a second hand car and who can repay over shorter terms. Sometimes car loans of this nature can be found that have 0% interest attached to them for a period of time. Providing you are able to repay the loan in full during this time, this can be an excellent choice for a car loan.
Car dealerships will offer car loans at the time of buying the car. However this is not the cheapest way of borrowing. You will be able to get cheaper quotes if you choose to get the loan yourself. A specialist website will be able to search with the whole of the market place of UK lenders and find you the cheapest quotes. You should then go over them with a fine tooth-comb. All loan quotes should come with key facts and these will tell you how much interest you would have to pay on the loan, how much the loan will cost in total and also any fees. One of the most popular forms is an early repayment fee. This means that you would have to pay out a lump sum of money if you find that you are able to payoff the full amount of the loan before the term. For example if you take a loan for 5 years and pay it off within 18 months then you would have to pay for ending the agreement early.