There are many options available for those looking to finance a new vehicle; one option is a personal loan.
What is a personal loan?
Personal loans are an unsecured lending facility that can be used for almost any purpose, not just for car finance. Usually a personal loan is taken at a fixed cost over a fixed period of time (normally a maximum of five years). The loan of the money can be used to purchase any item you are looking to buy – including a vehicle.
How is a personal loan different to other car finance options?
A personal loan is not secured against the car you are purchasing. Therefore, if for any reason you find yourself not able to complete the repayments, your car cannot be repossessed. The advantage of a car loan is that, unlike some car finance options, you can sell the vehicle on at any time during the loan agreement. Remember to keep up with your loan repayments as you still have the personal debt – unless you use the funds from the sale to repay the loan early!
Who should be looking to take out a personal loan?
A personal loan is suitable for those in full time employment, who have a good credit history. Those with a bad credit rating should consider other car finance options that are available.