There are several car finance options available to consumers, including:
- Hire Purchase (HP): A type of loan where the consumer hires the car for a set period of time and makes regular repayments. At the end of the loan term, the consumer can choose to purchase the car for an agreed upon price or return it to the lender.
- Personal Contract Purchase (PCP): A type of loan that allows the consumer to pay a deposit and make monthly repayments for a set period of time. At the end of the loan term, the consumer can choose to purchase the car for an agreed upon price, return it to the lender, or trade it in for a new car and start a new loan.
- Leasing: A type of rental agreement where the consumer uses the car for a set period of time, making regular payments to the lender. The consumer does not own the car and must return it to the lender at the end of the lease term.
- Balloon Payment Loan: A type of loan where the consumer makes low monthly payments for a set period of time, followed by a large final payment to pay off the loan in full.
- Personal Loan: A type of unsecured loan that can be used to finance the purchase of a car. The loan is repaid in full, with interest, over a set period of time.
It is important to carefully consider the terms and conditions of each type of car finance option, including the interest rate, repayment period, and any fees, before making a decision.