Thinking of availing a secured car loan in the UK? Car loans in the UK generally fall into two main categories:
1. Secured Car loans
2. Unsecured Car loans
As the name suggests a secured car loan is offered by the finance companies against a security. As a security, the car you are going to buy can be used or other valuable property. Since these loans are offered against a security, thus if the customer fails to repay the loan amount for any reason, then lender will take back their property.
Secured car loans are generally short term loans.
The term varies from 36 months to 72 months (At this point, customers should keep in mind that deciding long term period means paying more interest rate. So, to avoid loan burden, it is better to fix up the loan repayment term as short as possible).
At the time of buying of car, you will have to pay some amount upfront and the rest amount can be backed with car loans. Moreover, a down payment will help you to lessen the repayable amount.
In comparison with car dealership, secured car loans are more favourable for borrowers. Though, car dealerships are easily available, but for car financing they charge more. So, in that case secured car loans can be your pocket soothing. Besides, one can get secured car loans along with car insurance and also can refinance his car loan and avail a new car loan with lower interest rate.
Under this type of loan one can get a new or a used car.
To some extent credit score does matter at the time of availing a secured car loan. Generally if you have satisfactory credit score, then it would be easier for you to get a secured car loan at relatively lower interest rate. At the same time, keep in your mind that if you have bad credit score then it would not hinder you to avail these loans. But in that case, you may have to pay higher rate of interest.
Most loans for the purchase of a car are considered unsecured. This means that you are borrowing money without putting anything up for collateral or security against the loan. This type of loan is often more difficult, but not impossible, to obtain.
Unsecured loans are offered by many different lenders. Banks, building societies, and other lending companies are typical sources for this type of loan. You can also work through an independent loan broker who has access to many different lenders and many different unsecured loan programs.
The main advantage of an unsecured loan is that you do not put something of significant value, like your home, at risk. Many people already carry a mortgage or other secured debt using their home as collateral, so they are reluctant to add more. Other people don't have a home or property to use for security, so for them an unsecured car loan is really the only option.
Another advantage of an unsecured car loan is that the loan process usually can be completed more quickly than a secured loan. This is because you don't have to go through the extra step of having the lender determine the value of your collateral. Eliminating this step can speed up the entire transaction.
Unsecured car loans do have disadvantages. They typically carry higher interest rates, the amount available for borrowing is normally less, and they often come with restrictions on how you can spend the money you receive. Also, the rates and terms of an unsecured loan usually vary depending on your personal circumstances, so a lender's advertised rate may not be the one they ultimately offer you.
Whether you are willing to take a bad credit car loan or a used car loan or a cheap loan or interested in car loan refinancing in UK, there are companies to offer you the loan to fit into your repayment needs. Following are few of the popular finance companies in the UK offering Car loans:
"CarChoice" is the name of the car loan scheme offered by the HDFC Bank, one of the renowned banks in the world. This personal contract purchase scheme is provided by HSBC Vehicle Finance (UK) Limited, is an easy and attractively priced way of buying a new car in the UK........
With the Sainsbury's Bank Car Loans, customers can save time and money on their new car.With fixed, affordable monthly payments, the car purchase scheme could be the ideal way to finance your new car........
With Halfords, one can find an alternative and innovative way to own a new car in the UK, with no hassle and peace of mind. Now you can buy any brand of car for a fixed payment per month which gives you a guaranteed future value.........
Welcome Car Finance is a part of the Cattles Plc. group of companies, UK and handles car finance throughout the UK. The company is listed in the FTSE 250 list, has 4,000 employees and over 700,000 customers throughout the UK..........
At Clydesdale Bank Asset Finance Ltd, offers car or auto finance, which is fast, quick and easy to get the car the customers' want to buy!There is a repayment option available with the car finance scheme of Clydesdale Bank Asset Finance Ltd, with the fixed rate Hire Purchase........
AA Loans are provided or arranged by Automobile Association Personal Finance Limited, City House, City Road, Chester CH88 3AN. For AA Car Warranty, AAPFL introduces customers to Automobile Association Developments Limited (AADL)......