Car loans, or car finance, are ways of borrowing money to fund the purchase of a new car.
Car loans can be taken out from car dealers, car manufacturers, or from specialist financial firms.
Many analysts advise people taking out a loan for a new car to shop around for the cheapest loan on the market, and get their car finance in place before heading to the dealer to buy a new vehicle.
Additionally, while dealers frequently make enticing offers such as zero per cent interest for the first year, overall dealer finance is generally more expensive than the cheapest personal loan available from banks and financial specialists.
Sainsbury’s calculates you can save as much as £3,000 by using an independent car loan provider. (full story).
For people with a poor credit rating there are also bad credit car loans available from certain providers, although these are more expensive than a standard loan.
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