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Car financing has become a big business. A large number of buyers of new and widely used cars in the UK buy their cars in some form of cash. It can be in the form of bank loans, retail loans, mortgages, credit cards, "mom and dad bank", or other types of loans, but it is not limited to how much they spend on their own money to buy a car. Start.
Money from the dealer
For most people, getting a car from a dealer where to buy the car is good. There are also national offerings and programs that can make customer money a better choice.
What is a deposit
HP is like a mortgage on your home; Pay the deposit in advance and pay the rest over the agreed period (which is usually 18 to 60 months). This is how financial performance has worked for many years, but now it is starting to lose interest in the PCP options shown below.
The biggest disadvantage of HP compared to PCP is the high monthly payments, which means the value of the car you can afford is low.
HP is generally better than consumers; Plan to save your car for a longer period of time (i.e. longer than the monetary period), have a larger budget or seek an automated financial plan without any problems at the end of the contract.
What is a personal contract agreement?
PCP is often offered by other companies from payroll companies (for example, BMW Select, Volkswagen Solutions, Toyota Access, etc.), it is more popular and complex than HP. Most new car insurance claims announced these days are PCP and dealer trying to push you into PCP instead of HP because it would be better to have them.
Like HP above, it pays deposits and has monthly payments over time. However, the monthly payment is small and/or the term is short (usually the maximum 48 months), because you do not pay for the whole car. At the end of that period, a significant portion of the money was still visible. This is often called GMFV (Guaranteed future value). The auto insurance company promises, in some cases, that the value of the car will be less than the amount owed by the rest of the debt. This gives you three options:
1) Return the car. You won’t get your money, but you won’t have to pay for other things. This means you rent the car all the time.
2) Take care of the residue (GMFV) and save the car. Since this amount can run into thousands of pounds, it is not usually a viable option for many people (which is why they invest in a car in the first place), which often leads to ...
3) Replace the car with a new one (or a new one). The dealer will evaluate the value of your vehicle and arrange a fee for it. If your car is worth more than GMFV, you can use the difference (money) as a deposit on your next car.
What is a lease?
LP is a hybrid type between HP and PCP. Have a low deposit and monthly payment as a principal, as well as a large final payment at the end of the contract. However, unlike the first caregiver, this final payment (usually called a balloon) is not guaranteed. This means that if the value of your car is less than the amount you owe and you want to sell it on its side, you will have to pay any costs (called capital bad) before you consider paying for your car. again.
Guo nitty-gritty details
The most important thing for any car buyer for financial purposes is to read the contract and carefully consider it before entering anything. Many people borrow money from cars but cannot afford to pay a monthly fee. Since your budget will last for the next five years, it is very important to think carefully about what might happen in your life over the next five years. Most high-paying sports cars have ten