Buying a car soon? If so, you might not have thought about how you are going to pay for it! There are a few different ways to buy a car in 2014, but how do you know which one will be the right choice for you?
Car dealers won’t offer much help, other than to take out a finance agreement with them. Banks will tell you to get a loan, and family members might be reluctant to lend you the money (or they might not have any spare cash to give you).
Money can be such an ugly word. When you have it, it’s great. But when you don’t, it can make you feel depressed. The good news is that, with so many ways to buy a car, you will be driving out of that showroom in your new pride and joy in no time.
Here is a rough guide to the different ways to buy a car!
Cash
In a world filled with credit, cash still reigns supreme. Cash allows you to buy whatever you want without worrying about whether someone will lend you some money. With the amount of debt per head rising in developed countries around the world, saving up money seems like the best way to buy a car.
Some savvy car shoppers will keep any spare cash locked away in a high-interest savings account. That helps them to earn extra money towards their new car goal. If you do that, you might even be able to stretch to buying some optional extras for your new pride and joy!
But what if you don’t have a lot of spare cash after you pay your bills? You might not be around long enough to save up the amount of cash you need to buy your dream car! That is where the following options come in handy…
Finance
Getting a car and paying for it later is the option of choice for many motorists. You can buy a car on a hire-purchase agreement, or you can lease it over a period of three years or so.
Both options need a small cash deposit, with the balance payable over a period with fixed, monthly instalments. Leasing is popular with those that want to buy brand new Mercedes cars, for instance. Some models have high-ticket prices.
Hire-purchase is ideal for people that want to own their cars outright and is suitable for older cars with lower values.
Bank loan
Of course, it pays to shop around for the lowest interest rates when you need to borrow money. Few people realise this, but your bank can sometimes offer you a lower interest rate than a finance company can!
It’s worth approaching your bank if you need to borrow money so that you can choose the cheapest option from an interest point of view.
There are some comparison websites online that can help you to find lenders that offer low-interest rates. Bear in mind that you will need to have a good credit record to meet lending criteria.
Now that you have the information you need, it’s time to get busy! Good luck with your new car buy!