With the current state of the markets, the buyer is spoilt for choices in both new and old cars. Many people have their eyes set on a specific model and even the year of the car. Getting your hands on the car of your dreams can be a difficult thing, but the feeling of driving the car of your dreams into your driveway is like no other.

Read on to learn more about how you can make your dream a reality without busting your carefully laid budget with cheap car finance.

Option 1: Credit card

Before you attempt to take out a car on a credit card, you will need to make sure that the agency you are working with accepts credit card payments.

One benefit of this route is that your credit card company can add protection for the full cost of purchase — so long as the cost of the vehicle is at least £150 and less than £45,000. You will also have to consider the monthly payments you will be making.

If you will be using this method of paying for your car, you are allowed to make an even smaller deposit than 10% and pay off the remaining cash with a debit card. But you will want to consider all your options before you choose this route as you may find that your credit card payments are considerably higher than other payment types.

Option 2: Hire purchase agreement

This method of payment involves a plan of monthly payments and the option to buy the car at the end of the payment considering the car’s value at the time.

This option always comes with a standard payment of 10%, but there is also the option to pay more upfront and then have less to pay later. The rest of the car will be paid in a 1- to 5- year installment plan. The longer the term of your installment plan, the lower your payments will be, but you will end up paying more due to the change in interest.

Option 3: Personal Contract Purchase agreement

This option is very similar to choosing a hire purchase agreement. The Personal Contract Purchase Agreement allows the value of the car at the end of the contract to be decided when the contract is signed. This way you can plan your payments accordingly. Payments in this way are always much lower than what you can expect in a hire purchase agreement where you will pay for the full price of the car, plus interest, and minus the expected depreciation of the car. Of course, you will have to pass a credit check before you can be eligible for this payment method

If you can manage, it is always best to have a large sum that you can put down to make a larger deposit, this will greatly reduce what you will have to pay monthly. Saving a large sum of money that can be used for down payments is much easier than facing the high-interest rates on larger monthly payments. Always take a close look at the monthly payments you are making before you agree to this type of arrangement, getting behind on monthly payments can be a recipe for disaster.

After the contract you will have two very favorable options, you can choose to pay off the pre-decided future value of the car, or you can choose to hand back the keys to the agency and use the car as a down payment for a new car.

One thing to note about this method of getting the car of your dreams is that if you exceed the forecasted mileage you will have to pay further charges. This is simply because the more miles the car has the less value it has. Furthermore, any damage to the car will be charged to you — so, do your best to take good care of the vehicle.

As you can see, driving the car of your dreams is not an impossible dream after all. If you take the time to save up for a nice deposit, you can greatly reduce the payments you make. Be sure to prepare well for this move by carefully analyzing your financial plan before you begin.



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