Financing the second most expensive purchase you'll ever make
In the world of loans cars come second only to houses: for most of us, our car is the second most expensive purchase we'll ever make (unless of course you decide to live in a caravan and drive a Ferrari). As a result there are plenty of loans on offer.
In the world of loans cars are big business: for most of us our car is the second most expensive thing we've ever bought (your house is, of course, the most expensive – unless you live in a shed and drive an Aston Martin). That means that getting finance for your vehicle is easy, although there's a huge range of packages to choose from.
When it comes to loans cars are usually financed in one of three ways: through a finance deal arranged by the dealer (or a lender affiliated with the dealer); by a standard personal loan; or via a personal contract plan. A personal loan is the simplest, although some dealers offer 0% finance deals that can be worth considering. Personal contract plans are more complex: generally you borrow around half the value of the vehicle. At the end of your contract period you can either pay a few thousand pounds to own the vehicle outright, walk away or start a new contract for a new vehicle. Although a personal contract plan is a good way to finance a new car, it's worth noting that there are generally strict mileage limits.
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