Car finance in Norwich
Finding and buying the right car can be a challenge, especially if you are working on a tight budget. Fortunately, there is a solution in the form of car finance, and we have all the information you need to get started with car finance in Norwich. Read on for all you need to know.
What is car finance?
In the simplest terms, car finance is simply borrowing money from a bank or other financial institution to buy a new or used vehicle. The loan will usually last between two and five years, depending on how much you borrow and what type of vehicle you choose. This means you pay back the loan over time by making regular repayments.
The amount you pay towards the vehicle will depend on the size of the loan. However, it’s important to remember that the total cost of ownership will include not only the price of the vehicle itself but also interest on the loan, and the car’s running costs such as fuel and maintenance.
What are the advantages of car finance?
There are many advantages to using car finance when buying a vehicle. For example:
- It is easy to apply for
Applying for car finance is easy because most lenders offer instant online applications. They’ll ask for basic details about your personal circumstances, including your income and savings, so they can work out whether you’re eligible for a loan.
- You can choose a vehicle that suits your needs and budget
When you use car finance, you can choose a vehicle that suits your needs and your budget. If you want something more practical, then a small hatchback might be ideal; alternatively, if you prefer something sporty, you could opt for a sports car.
- You don’t have to pay any fees to apply
When you apply for a loan through a lender, you’ll often find that you don’t have to pay any application fees, as most lenders even waive them completely.
If you decide to go down this route, make sure you shop around before choosing one particular lender. Or even choose a broker such as Car Finance Genie, which can bring you the benefit of the best deals from across our lending panel via a single application.
It’s worth checking each potential lender or broker’s customer service record, too, to see if they provide good support after you’ve taken out the loan.
Are there any downsides to car finance?
Of course, there are always risks involved when taking out a loan. Here are some things to consider:
- Your repayment will be higher than with cash upfront
One of the main drawbacks of car finance is that you’ll end up repaying more than you would have paid if you had simply bought the vehicle with cash up front.
After all, with a car finance deal, you won’t just have to pay for the car itself – you will also need to pay interest on the loan. But this might be a worthwhile extra to pay for the privilege of paying for the car over a longer span of time.
- You may not get the best deal on the market
Another drawback of car finance is that it doesn’t always give you access to all types of vehicles. Some lenders won’t allow you to buy certain models, like luxury cars or high-performance vehicles.
However, this is simply all the more reason to turn to a broker such as Car Finance Genie, given that we could bring you deals from many different car finance providers, rather than just one.
What are the types of car finance?
Before you take a closer look at how much you need to borrow, it’s important to understand what type of car finance you can get.
There are two main types of finance available:
- Personal contract purchase (PCP)
This type of car finance enables you to pay off the full amount of the loan over a set number of years, and then have the flexibility at the end of the agreement to buy the car outright with a final ‘balloon’ payment, or instead return it.
- Hire purchase (HP)
This type of car finance is similar to PCP, with one major distinction being that once you have completed the main repayments on the loan, the car will automatically become yours. There won’t be any final ‘balloon’ payment to make in order to acquire the car at the end of the loan term.
It can be easy to think that buying a new car will be expensive. However, by using the best car finance in Norwich as would be accessible through Car Finance Genie, you could help bring the vehicle you truly want within your financial reach.