Hot Topics

What is a Debt Consolidation Loan?
A consolidation loan offers the opportunity to put all your outstanding balances together into one block. This can include credit cards, personal loans and sometimes your mortgage.
If I decide I need a personal loan, which type of lender is best?
Banks, building societies and specialist finance companies all offer personal loans. None are any better than the others in any outright sense – but because the market is so competitive, you'll need to shop around.
How quickly can I get the money?
How quickly you get your loan depends on who you buy it from.
What is credit scoring?
Most of the major credit card companies use their own credit scoring systems – normally but not always in conjunction with a credit rating from a credit reference agency.
What if I die before my loan is paid off?
If you die before your loan has been fully repaid, the loan will still need to be repaid by your estate. This may mean that your family will have to cover the cost of the loan for you.

What is a Car Loan?

There are three different types of car loan. We have covered them here to make you aware of the options open to you when seeking a car loan:

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Hire purchase (HP)
This sort of car loan is arranged by car dealerships, and in effect it means that you are hiring the car from the dealer until the final payment on the loan has been paid. When the loan has been fully repaid, full ownership of the vehicle is transferred to you.

Manufacturers' schemes
You see these types of loans advertised by the car manufacturer and these can be arranged either directly with them or via a local car dealership. Part exchanges on your current vehicle are normally accepted, and the remaining balance is paid through a loan. As with a hire purchase scheme, you will not be the owner of the vehicle until you have repaid the loan in full. If you default on repayments, the car will be repossessed. The manufacturer will sometimes offer exceptional deals, sometimes interest-free credit on selected models – however these schemes are usually offered at higher interest rates than those found with regular lenders. If the car you are looking to buy is available through a zero percent or low interest rate manufacturer scheme, it would definitely be a good choice.

Personal Loan
You have the option of either taking out a general personal loan, or a personal loan designed specifically for car purchase. The two are almost identical, but because a car loan is taken out specifically to buy a car, the lender may offer you car-related incentives such as emergency breakdown cover, free motor insurance or special discounts on car accessories at affiliate garages and stores. Personal loans normally have lower interest rates than manufacturer schemes or hire purchase loans, however you’re not so likely to get a special low interest rate deal. The main advantage to getting a personal loan is that you are free to shop around for your car, as you are not tied to a specific dealer or manufacturer, and you may find that you have more negotiating power if you are buying with cash.

 

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Risk Warning
Your home may be repossessed if you do not keep up repayments on a mortgage or any debt secured on it. Security by way of a charge on your home may be required.
Think carefully before securing other debts to your home.

 

 

 

 

 

 

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