Car finance is a way of paying for a vehicle over time, with an arrangement of making repayments. There are different types of car finance options available, but most require a deposit followed by monthly repayments.
Find out how our car finance works.
Car finance allows you to spread the cost of buying a car or vehicle over a chosen payback period, so it’s a great way to get yourself a set of wheels without needing to save up a large sum of money up front.
Car finance is usually spread over a 24 – 60-month period. In most cases, the longer the amount of time, the lower the monthly repayments, so you can choose a length of time you can afford. Find out the monthly repayments you could expect with us using our car finance calculator.
An Annual Percentage Rate (APR) is the total cost you pay to borrow the money for the year. APRs change per product, company and person, so it’s always important to seek this information out. The rate of your APR for car finance with us will firstly be decided by your current credit score. So, if you currently have bad credit that might be why you are paying a slightly higher APR on top of your original loan.
There are many factors to consider when seeing if you’re eligible for car finance, including your age, income and affordability. Our application process is simple, so you can find out if you’re eligible for car finance today find out more about our application process.
At Moneybarn, we look beyond your credit score, to help you find the vehicle you need. Find out more about our bad credit car finance, or see what repayments you could expect using our car finance calculator.
When it comes to car finance there are lots of different types of finance available, it’s important to understand your options and how they differ so you can find one suited to you. Below we list the most common types of car finance
It’s important to fully understand the terms and conditions and all of the costs before you sign the finance agreement. One way for you to lower your monthly repayments is by putting a deposit down on the car, which lowers the total amount of finance that you borrow. A car or van deposit can help to make your finance more affordable and ensure that you can get a car that really suits your needs. Zero deposit is when you haven’t got a cash deposit, or you may prefer not to put a deposit down.
Moneybarn uses a conditional sale agreement for car, motorbike and van finance. A conditional sale agreement means that you will have full use of the vehicle for the term of the agreement and it will be registered in your name; however, you will not own the vehicle until all repayments are made.
Once Moneybarn has approved a finance application, the next step in the process is to find the car or van that’s right for you. This allows us to create a quote for you which shows exactly how much the agreement will cost you on a monthly basis and in total.
Advantages of Conditional Sale
Disadvantages of Conditional Sale
Hire purchase (HP) is when you essentially hire the car from the lender until it’s been paid for in full. You can then pay a final fee which is referred to as the ‘option to purchase’ fee to own the car outright. This cost can vary but is usually around £100-£200. You’ll officially own the vehicle once all repayments are made and you’ve paid the option to purchase fee.
Advantages of Hire Purchase
Disadvantages of Hire Purchase
Personal contract purchase (PCP) is where you pay a deposit followed by repayments, however at the end of the agreement you’ll have the option to either hand back the car or take over the ownership. If you wish to keep the vehicle, you’ll need to pay the Guaranteed Minimum Future Value fee. If you choose to hand back the vehicle you can use the equity as a deposit for your next vehicle.
Advantages of PCP
Disadvantages of PCP
A personal loan allows you to borrow an amount of money which you can then use to purchase a car.
Advantages of a personal loan
Disadvantages of a personal loan
Car leasing is a long-term rental of a vehicle. If you choose to lease, you’ll have to hand back the car at the end of the lease term. In a typical lease agreement, you’ll pay a deposit or initial repayment followed by fixed repayments over time.
Advantages of car leasing
Disadvantages of car leasing
Please note Moneybarn only provides conditional sale agreement for car, motorbike and van finance.