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Cheap car credit can be found

Cheap car credit can be found if you take the time to do your homework and find out which of the many options will be the most suitable for your needs. Of course the most suitable type of loan will depend on several factors such as your current status and ability to repay. The type of car you are buying for example new or used. Your credit rating, if you have a bad rating then you could be turned down or have to pay over the odds in interest.

Cheap car credit can be found if you take the time to do your homework and find out which of the many options will be the most suitable for your needs. Of course the most suitable type of loan will depend on several factors such as your current status and ability to repay. The type of car you are buying for example new or used. Your credit rating, if you have a bad rating then you could be turned down or have to pay over the odds in interest. All of these and more need to be considered before you go rushing into taking on something you cannot manage.


Considering hire purchase, personal loan or personal contract plan?


Should you choose to buy your car from the dealership then you could consider hire purchase, personal loan or a personal contract plan. All could be suitable options for finance.


The personal contract plan
The repayments with the personal contract plan can be very enticing and along with this if you easily get bored of a car this could work out to be an excellent choice for financing. You will be asked to pay a deposit and then pay low monthly instalments over a period of time; this will leave a lump sum balance at the end of the term. When the end of the contract was reached you will then have three choices to make:
•    give the car back to the dealership
•    choose to pay the balance left outstanding in a cash lump sum and keep the car
•    sell the car and pay what was left off and hopefully have some left over


Hire purchase
With hire purchase you pay a deposit which will usually be at least 10% but you could offer to pay as much as you like. You then repay the rest over a period of time and once the term of the agreement had been reached the car will be yours. The more deposit you put down the less you will have to borrow and so you will pay out less interest. You will have to bear in mind that:
•    The car is not yours until you have paid off the final instalment which means if you defer on the agreement the car can be taken back by the dealership.
•    You will not be able to sell the car until the final instalment had been paid.


Personal loan
With a personal loan you will be able to shop around for the lowest rate of interest and the most suitable deal for your needs. Here are some of things you have to consider when choosing this as your finance method
If you have an excellent credit rating and you do not want to borrow a large amount which could be paid back fairly quickly then you could look for a 0% interest deal on the loan.


You will have cash in hand which could give you some power in getting something off the asking price for the car.
You will have to have a good credit rating when looking for cheap car credit this way as you could be turned down or have to pay over the odds for the interest rate.
 

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