| Thinking of buying a new car? Unless you're paying | | | | purchase the car outright for this sum and sell or use it |
| cash, presumably you're looking for the best way to | | | | in part exchange it towards your new car. |
| finance the car of your choice. | | | | If you take the same vehicle on the second (lease) |
| For people who choose to buy a new car every two | | | | plan, you would make an initial payment of £969 |
| or three years, personal contract purchase, or PCP, is | | | | and the monthly payment would be £323. |
| gaining in popularity. Your car dealer or the | | | | The other choices to consider for vehicle finance are |
| manufacturer effectively lends you the balance of the | | | | personal loans or hire purchase. With hire purchase the |
| car, after you've paid a deposit of 20 to 25 per cent. | | | | loan is secured on the vehicle. Because of this, if you |
| A fixed trade in price is promised at the end of the | | | | get behind on your repayments, the vehicle can be |
| deal. An annual mileage limit will be agreed and as long | | | | repossessed by the lender. Obviously, having |
| as this isn't exceeded you will be offered a choice of | | | | completed the payments on the car, at the end of the |
| options when the contract ends. | | | | period, the vehicle is yours, without any ties, limitations |
| The choices will be | | | | on mileage etc., |
| 1. To return the car and change to a new one. | | | | Offers of low or even no-cost credit can be found. |
| 2. To trade it in at its second hand value - this may be | | | | Unfortunately they're often unavailable on the model of |
| more than the guaranteed figure, which makes it well | | | | your choice. In common with many other |
| worth doing. | | | | manufacturers, Vauxhall have some excellent offers |
| 3. To keep the car, making a final payment of the | | | | with several models currently being offered at 0% |
| outstanding balance. | | | | interest over four years. For models not in the 0% |
| Many people simply replace their car every couple of | | | | range, for example the Astra Life 1.6 16v, the offer is |
| years, using the first option and keeping to the same | | | | considerably higher and in fact doubles the interest |
| dealer or manufacturer. | | | | rate which most people pay via GMAC, the company |
| An alternative to personal contract purchasing is a | | | | that offers loans for customers buying directly from |
| simple car lease plan. An initial deposit is paid, which | | | | Vauxhall. |
| works out at three times the monthly lease payment. | | | | Of course, you don't have to go along with the |
| The lease payment is then made for 24 or 36 months, | | | | manufacturers deals and can work out your own |
| depending on the contract. At the end of the time you | | | | comparisons by comparing the cost of personal loans. |
| simply return the car and walk away. There are no | | | | Log on to the internet and find a broker to check out |
| obligations and you're free to go ahead and choose | | | | the various loans available. |
| your next vehicle without the complications of selling a | | | | In general most car manufacturers will be able to offer |
| second hand one. | | | | some good deals when it comes to finance and it's |
| To make a comparison on costs using the two | | | | worth finding out what's on offer for the car of you |
| methods shown above, if you take a vehicle costing | | | | choice. It's always a good idea to check what the |
| £14,995, bought through a personal contract | | | | same vehicle would cost using a personal loan and |
| purchase plan from a dealer, on a 3 year plan, you | | | | weighing up the final price paid is always worthwhile. |
| would pay a deposit of £1,548. There would | | | | So, whatever your choice, personal loan, hire purchase, |
| then be a repayment period of 36 months @ | | | | personal contract purchase or a simple lease plan, |
| £309 per month. The deal would guarantee you | | | | there are plenty of ways to finance your new car. Do |
| £3,861 towards a new car if you were staying | | | | your sums right and there are big savings to be made. |
| with the same dealership. Alternatively you could | | | | |