By: Raymond James

Getting a new car may prove overwhelming to some due to the numerous processes that go into the decision-making process. You will have to consider what car you want, the size, color, financing options, and time limit. All this may be too demanding for some people; thus, working with car finance experts in Sydney is essential to enable you to see which financing options work best for you.

5 Alternative Ways to Finance Your Car

When opting for a financing option, it is necessary to do proper research and work with experts to make the right choice. A car has become a necessity; thus, carefully selecting the right finance option not only provides you with a means to continue your typical day to day lives but ensures you take a car within your budget. Some financing options to make your journey easy includes;

Car loan

By taking a car loan, you partner with a finance company to pay the car dealer the entire amount and use the vehicle as collateral. This type of financing is considered a high risk due to the chances of the finance company taking the car if you are unable to pay. The interest on this loan is relatively lower. It means you have the opportunity to purchase your vehicle and pay back the loan within a shorter period.

The car loan requires a great deal of discipline to ensure you promptly pay your monthly dues to avoid seizure of the vehicle. Consult with experts to ensure you use a reliable finance company and get the best rates for this option.

Personal loan

Unlike a car loan, a personal loan is issued to an individual with no security. This type of loan is an unsecured loan and mainly uses an individual’s pay-slip to determine how much they can refund back monthly. Since the lending company has little security but your pay-slip, this type of loan has higher interest rates but saves you the worry of losing your car if you default on payment. Thus, it is a great way to get a vehicle, especially for those working and who require an upgrade or a car quickly.

Hire purchase

Hire purchase is another alternative of financing for a vehicle. You can use this channel to get a personal or commercial vehicle. For commercial vehicles, a person works with a finance company who buys the car then lends it to them, allowing you to carry out your business and pay specific amounts monthly. Once you are done with the vehicle’s full payment and interest, the finance company then hands you the vehicle’s documents.

You have to partner with the car dealer who gives you the car while retaining its records. You are then supposed to pay a deposit and monthly installments then secure your vehicle once you have paid its premium. However, more interest is charged on the extended repayment period.

Pay cash

Paying for a car’s value before a purchase is an excellent way to escape interests and ensure you do not buy your vehicle at a high price. You can opt to talk to family members to get interested free loans and repay them over time. You can also speak to capable family members to have them buy you the car and then repay them over time.

For such a financing deal, you would need to write a binding agreement to ensure other people feel safe giving you their money. It is an excellent arrangement, especially for those who would like to escape the high-interest rates charged on other financial solutions.

Use your credit card

For those with excellent credit scores, using your credit card is a fast and efficient way of buying a car without too much people’s involvement. For those with credit cards that enjoy higher limits, you can quickly finalize your purchase using the card and ensure you diligently repay the monthly installments to avoid bruising your credit score. The good thing about a credit card is that it has fewer risks and has a straightforward procedure that enables you to complete your car purchase faster.

Conclusion

Working with car finance experts ensures you pick the right financing option. They provide you with all the information you require to make the best decision that will enable you to own your car and carry out repayments in an adequate planned manner. Consider the above financing options the next time you plan for a car purchase.

About the Author:

Ray is a sought after thought leader and an expert in financial and money management. He has been published and featured in over 50 leading sites and aims to contribute articles to help novice financial planners. One of his goals is to impart his knowledge in finance to educate and help ordinary people create and achieve their financial goals.

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