With the UK?s Economy still some-what shaken from the first double-dip recession in over 30 years, saving money has become harder than ever. Household bills have hit new highs while wages have stagnated meaning that many are seeing their disposable income drop lower and lower.
Having very little money left over at the end of the month makes saving an almost impossible task. So if you are in need of a new car, the only feasible option is to turn to financing. There are a number of car financing options available, many of which are in fact relatively inexpensive.
Garage Finance
Firstly you could use a financing option offered by the garage that you are buying the car from. The rates offered by the garage will be competitive and flexible however they will be based on your circumstances meaning that if you have poor credit, the rates you will be offered will be high, you may even be declined.
Bank Loan
Alternatively, you could go to your bank for a personal loan. The rates offered by the banks are very low however they are reserved for those with an immaculate credit history meaning any defaults or CCJs on your credit record will result in your application being declined.
Guarantor Loans
If you do have poor credit then up until now you may have found it tough to get the finance you need. Guarantor loans are an up-and-coming loan product that is designed to help those who have been unable to get credit via traditional methods such as their bank. Lenders are able to offer up to ?5000 on the proviso that the applicant can provide a homeowner guarantor to stand as back up on the application.
It is the guarantor?s responsibility to stand in and make repayments on behalf of the borrower if for any reason they are unable to do so. Applicants are able to choose to borrow their loan over a term of between 1 and 5 years. Choosing to borrow the loan over a longer term will make the repayments smaller however the total repayment figure will be higher. Alternatively borrowing the loan over a smaller term will make the repayments higher but the total cost of credit lower.
Guarantor loans are seen as a good way to finance the purchasing of a new car due to their flexible repayment terms and quick processing. The majority of guarantor loan lenders will be based online meaning the application is quick and the money could be in your account the same day as you apply.
Author Bio: This article has been written by Jason Scott on behalf of Guarantor Loans UK. To learn more about guarantor loans visit their website.
This entry was posted in Debt Issues, Driving and tagged bank, finance, loans. Bookmark the permalink.Source: http://www.freedomfromdebt.eu/using-guarantor-loans-for-car-finance
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