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Dealer car loans are popular when new car purchase

56% of new vehicles had been bought utilizing finance from vehicle sellers within the 12 months in order to Might This year, according to the Finance & Leasing Association (FLA) — the greatest business since 03 2009.

Within May, there have been Thirty eight,174 new vehicles purchased on financial – 3% higher than within Might This year – in a combined value of £505 zillion. Meanwhile, the number of used cars bought upon finance was 6% higher than a year earlier.

Paul Harrison, Mind associated with Engine Financial at the FLA, said: “While financial doubt impacts consumers when creating large purchasing decisions, used car loan companies possess responded by providing value-for-money packages. More than half of all customers choose to use finance from the dealer once they buy a new or even used car.”

Vehicle buyers who want to make their purchase using motor finance have a number of options. Many people simply take out an unsecured loan — but many go for hire purchase (Hewlett packard) and private agreement purchase (PCP) agreements in the dealer.

A hire buy contract is a simple repayment plan, in which the buyer makes a set number of obligations more than a good decided time period. An individual contract purchase contract also entails creating a arranged number of payments, but after this time the customer has the use of make payment on leftover quantity as well as maintaining the car, part-exchanging this for a brand new vehicle or handing the car to the financial company.

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