Getting that set of wheels is probably the second biggest investment you’ll ever make after buying a house. And most likely, you’ll run a little short on cash during the purchase – a thing that was causing trouble for car buyers till now. No matter what your credit score says, there are car financing options available to anybody who’s looking.
Although buying with cash might be the best approach, personal loans offer the second best option. You can secure a loan from a bank or savings society and spread the payments across several years. However, Unions are particularly soft on members, and you might get a loan on a reducing balance interest. But don’t be tempted to place the house as collateral, you stand a chance to lose it if things don’t go as expected.
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Car dealers want in on the interest too. After realising the gap in car financing, most of them decided to adopt the hire purchase business model. Here, you pay 10% (or more) of the car’s price upfront then clear the rest in equal monthly installments. But some dealers may be working with other financial institutions so expect to pay a higher amount compared to personal loans.
Peer to peer loans
Sometimes, asking for loans from friends and family makes all the difference. All you need to do is save up as much as possible then ask for some help. It may not be exactly “free money”, but the truth is, any interest accrued here may not be as high as banks or credit unions.
Use a credit card
Using a credit card might be the riskiest way to pay for a car considering that you’re expected to pay up at the end of the month. So, whatever you do, make sure this amount is manageable to avoid nasty surprises later.