 Finance options for buying a new diesel car
Buying a car can be a stressful enough experience in itself but, coupled with the enormous diversity of financial products available in order to fund your purchase, the whole experience can become bewildering!
Each of the following institutions have their own particular strengths and weaknesses and part of our job is to match your requirements with a reputable financial institution.
What products are available to me a private individual?
Deferred Payment
In principal, works in the same way as Hire Purchase. The only difference being that the first payment is deferred for three months. So that you can BUY NOW and PAY LATER.
Hire Purchase
The traditional, but still ever popular, funding option which gives the customer eventual ownership of the vehicle.
A fixed cost, fixed period loan that allows you to spread the cost of the vehicle over a period of up to five years. The user is effectively the owner of the asset, but legal title to the car does not pass until the loan is fully repaid including the final payment which includes a nominal “option to purchase” fee. Monthly payments cover the capital cost plus interest and do not carry VAT. For business users the vehicles will be On Balance Sheet.
Personal Contract Purchase (PCP)
Similar to Hire Purchase, with the added advantage of the finance company guaranteeing a minimum future value on the vehicle at the end of the period.
PCP is for the private individuals who want the option of eventual ownership coupled with the security and peace of mind of the finance company guaranteeing that the vehicle will be worth the specified minimum amount (subject to normal wear and tear and an agreed mileage) at the end of the period.
In essence, you pay a low initial deposit followed by a fixed monthly rental for the period of the loan.
At the end of the agreement the guaranteed future value becomes relevant and you, the customer, have 3 choices:
- You can buy the vehicle by paying the guaranteed future value and the car is yours. This value is fixed at the start of the agreement and will be as stated on the original documentation.
- You can hand the car back to the finance company and take another car on Finance. You are only liable for any excess mileage and any damage other than from fair wear and tear.
- You can part exchange the vehicle against a new vehicle of your choice.
Personal Contract Hire (PCP)
For private individuals who want a hassle free and cost effective way to finance and maintain a vehicle.
Personal Contract Hire (PCH) gives the user a fixed equal monthly rental for a fixed contract term and mileage. At the end of the contract the vehicle is simply handed back.
Popular with company car drivers who are given a car or allowance instead of company vehicle. It allows the individual to make his/her own choice and arrangements.
This will avoid benefit-in-kind taxation. The finance company assumes the risk of the value of the vehicle.
Warranties
All cars come with 12 month 5* unlimited mileage warranties. All commercials come with a 3 month warranty. These can be extended to 2 or 3 years, please ask one of the sales team for further information.
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