The Traditional Way Of Buying A Car - Is It Best For You:
Hire purchase is one of the more straightforward ways to buy a car as you're simply spreading the cost with monthly payments until you've paid off the asking price and the car is yours for the keeping.
Dealerships offer hire purchase through finance companies and can arrange this as part of the car buying process on the spot. But you don't have to do it this way - you can often approach finance companies directly and by shopping around you may find a better deal on the APR and other costs.
Advantages:
- At the end of the term, the car is your property.
- Rates can be competitive.
- Minimum deposits will also be attractive.
- The total amount of interest you'll pay is low compared to other options.
- The interest rate may be negotiable - try haggling.
Disadvantages:
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The loan is secured on the car, so if you don't keep up repayments it may be repossessed.
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Monthly payments will be higher than for PCPs.
