About Car Finance

Dreaming of owing a car and actually owing the car are two different things if you consider the statement from the point of view of the money involved. You can always dream of owing the fastest supercar, but ‘can you own it’ should be the question that crosses your mind. Moreover, even if you can own the car, how do you plan to purchase it? Commodities like cars are high-value items and you cannot simply go to a showroom and pick up the car of your choice by paying the full amount in cash! Even if you have the money, due to taxation rules, policies and regulations, it would be a bit difficult to seal the deal, if not impossible.

The Option of Car Finance

Car finance enables you to own a car without the hassles involved when filing your tax returns. It would be wise on your part to get a car finance done instead of paying the full amount (in case you’re capable of). The next thing you should do in such a case is that pay the remaining amount in greater installments within a few weeks so that you do not lose money over the interest of the finance taken. In case you’re one of those who are grappling to come up with the blow of the recession, car finance is THE best option for you.

If you do not understand what car finance is (or have a vague idea about the same), the best thing for you would be to get a car finance broker, who will make sure that you get the best deal – after all, his job is to get his customers the best car finance options available there!

Car Finance and Types

Yes, much to your dismay, it can be of 3 types:
• Leasing – PCP (Personal Contract Purchase)
• Hire Purchase
• Car Loans

When using a car leasing option, PCP is a good option for those who are not looking at high value deals. The good thing about the option is that you actually have the option of owning the car and not purchasing it or purchasing it after the end of your lease period. You obviously won’t have to pay the full amount of the car after the lease period (2 or 4 years) but the remaining amount (lease amount paid deducted from the actual value of the car) – a great option when you frequently change cars or want to have a ‘feel’ of the car before actually buying it. The only drawback being the restricted mileage you can clock on the same.

Hire Purchase gives you the option of owing the car at the end of the agreement; though you still own the car when you shell you monthly installments for the car. The monthly repayments are likely to be higher than the PCP, here.