Skip to main content

Are Car Loans a Good Idea in the Current Economic Climate?

It’s impossible to provide a blanket answer for the question above because every situation is different and a loan may be a great idea for one person and a potential disaster for another. If you’re thinking of taking a loan out, whether it is to do home improvements, buy a car, move house or take a holiday, or simply just to pay off bills and consolidate some debt, it is definitely worth taking time to mull over your financial situation and weigh up the options.

Why a car loan is not a good idea

If you want a new car the idea of spreading the cost could force you to choose something which is realistically beyond your means. If you only had the option of buying a car outright, you would be limited by your bank balance, but if you can take a loan out or spread the cost via a finance deal, this means you can spend more. If you are already in debt and struggling to keep on top of your outgoings, adding a car loan repayment to the mix is not a good idea.

If you are going to take out a loan, ensure that you can afford the repayments before you sign on the dotted line and be realistic when you are calculating your budget. Remember that a car comes with a host of additional costs, including tax, MOT and insurance, as well as maintenance costs, which can spiral into the thousands.

Unfortunately, there are companies which prey on vulnerable people. Always check that your loan provider is approved and legitimate and shop around for deals to ensure you get the best rate. Seeing a financial adviser is always a good idea, even if you think you know all there is to know about loans and lending.

Why a car loan is a good idea

If you have a good credit rating and a secure income and you need a car and want to own it outright rather than paying for it monthly, now is probably a good time to take out a loan. Although it is harder to get a loan, the cost of borrowing is currently very low, with interest rates at rock-bottom and if your job is secure and you can afford the loan repayment, it is likely that the car will represent a good investment in the years to come.

If you are interested in getting a loan, shop around online with companies such as Car Loan 4U. There are so many providers around and they all offer different payment plans, interest rates and perks. You can use Internet to get a general idea of what you get for your money, but the most apt solution is to visit a financial adviser. They can advise you which loan is best based on your financial situation and the amount you want to spend.

Please take care

When taking out car finance, no matter how big or small, it is wise to air on the side of caution. Always read the small print, make sure you know exactly what the loan will mean for your monthly outgoings and ensure that you choose a legitimate provider. It sounds obvious but if you come across a deal that seems to be too good to be true, it probably is just that. Use providers you have heard of, such as the major building societies and take the advice of trained financial advisors. If you are going to get a loan secured against your home, be particularly careful, as there is a risk that your home could be repossessed if you do not maintain repayments.

Comments

Popular posts from this blog

Why it’s important to save for retirement

While retirement may seem far off in the distance for some, financial experts say you’re never too young to begin saving.  In fact, the earlier you calculate your retirement needs and start building your nest egg, the easier it will be to create a viable plan for the future. Many experts advise you begin saving a percentage of your income for retirement as soon as possible, no matter how little the contribution may be, as it’s possible the Social Security benefits millions of people currently depend on may be in jeopardy.

Low interest credit cards - how to make them work for you

Credit cards are borrowing instruments, unlike debit cards where you already have the money. Banks are there to make money too. Just like high street stores, they hope to maximise their profits within the rules. So it’s important to understand the basics and find a credit card that’s right for you – you can compare low APR credit cards here . Now you know the rules, let’s find out how to play the game. The financial services industry charges interest on the money that it lends out. Let us assume you borrow £100 on your credit card and keep it for exactly one year before you pay it back. For the purposes of this article, we will assume your loan attracts 8% interest per year, which is the Annual Percentage Rate, or APR for that particular transaction. Practical example

Basics of Stock Markets: The A-Z Quick Sheet for a Beginner-Level Investor

Several individuals wish to engage themselves in stock market and invest their money in stocks, but they don’t have an idea about Stock markets and how they work . In fact, there may be lot of info available to you, but they may all seem confusing without actually knowing the basics. This post aims at educating the beginners about the basics of stocks market. Read on to enlighten yourself about the A-Z of stock market. 

Looking For Ways To Finance Your Next Building Project? Look No Further

If you need money to start your next building project, you may be quite surprised by the number of different options you have. However, the options that will actually be available to you will depend on many different factors and these factors will decide how eligible for construction finance you are. In this short article, we will look at what you can borrow, how you can borrow, and what restrictions you might come across. Please note that while the information in this post is correct, your own personal situation will determine what the best course of action is for you. Speaking to an independent financial advisor will help you to see if you are eligible for construction finance and how to go about getting it. Different Types of Mortgages Let’s start with the different types of mortgages that may be available to you. Remember, whether one is better for your needs than another depends on many factors. Commercial Mortgages Let’s start with commercial mortgages because they a

Four factors that have fuelled city-centre living

Urban centres have become increasingly popular in recent years as both residential locations and as commercial space. This social change has been driven by a number of factors and has been reflected in the number of new property developments springing up in major cities around the UK. As space tends to be at a premium in urban areas, it has led to the construction of a greater number of apartments; potentially fuelling interest in block of flats insurance . So why have so many people decided that an apartment in a town is a better place to live than a larger house in the country? Here are four factors that are likely to have spurred on the rush for the city...

Manage Your Student Loan Debt Better in 2015

Image via gettyimages It is usually seen that most of the students fail to manage their student loan debts efficiently after their graduation. The reason is quite simple. Most of the students spend their earnings on comfort and luxuries instead of repaying their student loan debt. It has become comparatively easy to acquire student loans. However, each one of us should keep in mind the fact that repaying loans are not easy as borrowing it. This is why there arises the need of a proper strateg y when it comes to managing your loans. It is desirable to formulate these strategies while you are still in college instead of waiting until you get a good job. If you are one of this kind, here are some easy tips for you to manage your student loan debt better:

Learn how real estate agents value properties for sale

How do you get into real estate sales? Every owner wants to sell his property for its maximum value. And all too often they end up choosing a real estate agent simply based on who gives them the highest initial valuation. However, this will be a costly mistake. How your home is valued. If you make a mistake in the estimate, it is possible that it will be sold for a price that is less than the real value of the property. On the other hand, even overpriced homes will discourage potential buyers from viewing your home. Also, high selling prices can even result in a long wait before a good deal comes in or does not sell at all. Therefore, titration is recommended as a suitable agent. Here are some things that real estate agents consider during property valuation . But, few factors real estate agents consider when valuing a property. 1. Local services:   During property valuation, one of the main factors that can drive the sale price up is the actual area where the home is located. Aspects