So, you’re looking to get finance on a new, nearly new or used car. While this is the ideal solution for many to getting their next car, there are a few things you need to make sure you’ve considered first.
While affordability should be the top of everyone’s list of things to think about, you could use our Apply Now feature, which makes it simple to find out if you’ll be accepted and how much you can afford before you pick one of our cars.
However, it’s also important to be informed before you take out car finance. That’s why we’ve put together a list of nine car finance problems and how to solve them, so you can feel confident in finding a funding solution to help you get behind the wheel of your new car.
It’s tempting when looking for your next car on finance to get side-tracked with all the options available. However, it’s really important that you make sure you can afford it. Could your circumstances change in the future and would this affect your ability to pay?
Establish how much you’ll be paying both monthly and overall for your car and make sure it fits with your budget. If not, you could consider another option or look at ways to get a better deal – such as putting down a larger deposit or working on your credit score to bring down interest rates.
It’s not only your financial circumstances that can decide the car finance you choose. It’s also the kind of car you want and how you want to finance it.
If you want a car that’s perfect for you, think about the type of car you need and how you plan to use it. Will the car be one you want to own at the end of your finance deal or might your needs change?
If you’re after a modern, brand-new car, be aware that you may need to borrow more or find a larger deposit. However, with a newer model you could be looking at lower maintenance and servicing costs.
Would you prefer to get a new car every few years or is depreciation a concern for you? In that case maybe leasing could be something to look into.
Make sure you do all your research and look around before settling on the car and the finance option that’s right for you.
Everyone has different circumstances, and when it comes to getting the best deal on car finance you could feel bewildered by all the options out there.
Ultimately, it’s down to trust. While it’s more than possible that a new finance broker could offer a good lease deal, turning to one that has more experience or a larger panel of lenders to choose from may lead to a deal that is more suited to you.
Don’t get stuck with a car finance company that has restricted lending options – either a small number of lending options or one which doesn’t suit your needs, as applying through the wrong lender can hurt your credit score.
So it’s important to pick someone who will look at your individual circumstances as well as what you want out of the car finance, so they can tailor a solution for you and ensure you get the best deal.
New car leasing or financing can be pretty straightforward, although when it comes to leasing make sure the company has access to a good supply of new vehicles. Be wary if your car dealer or leasing broker seems to be pushing one model too much as this can often indicate that they have got a job lot from somewhere or need to move less popular stock.
However, when it comes to used or nearly new vehicles, it’s different. You don’t want to get caught with a company that simply doesn’t have the capacity or the skills to prepare your vehicle properly.
Ideally, your dealer should be able to prepare the vehicles to an excellent standard and be able to handle everything from small hatchbacks with diamond cut alloys through to vehicles with the latest hybrid and electric technology. Established franchise dealerships will offer this as well as finance and leasing brokers such as Hippo Motor Finance.
Pay special attention to how your deposit affects the headline price (this is the monthly price the leasing broker or finance company advertises the vehicle for).
It’s easy to be enticed by an attractive monthly price, only to find out you have to pay an exorbitant initial rental. Small deposits are quite standard, but deposits in the hundreds or thousands of pounds range can be harmful down the line.
When it comes to car finance agreements, as previously stated, you need a big panel of proven lenders, but it’s also important to choose lenders that offer soft search capabilities so that there’s no chance of your credit rating being negatively impacted.
Soft search is not something all brokers can offer as it’s costly to implement behind the scenes. But a broker with your best interests at heart should be able to offer this service so that you don’t need to commit to a hard credit check that will impact your credit rating if you’re declined.
Does your car come with a warranty? New cars will obviously have the manufacturer’s warranty, but this isn’t the norm when it comes to used vehicles. Is the dealer or supplier confident enough in their vehicles to offer a complimentary warranty on the car? If not, consider looking elsewhere as not having a warranty could cost you further down the line.
Fail to stick to the terms of your agreement and it could end up costing you. Particularly with PCP or PCH agreements, be sure to know what you’re signing up for.
While most of us have an idea of how many miles we will do, you never know what will happen – even a change in job location could mean you need more than the agreed number of miles on the contract.
The charges for excess mileage are normally between 4p and 15p per mile, but can be as much as £1 which can lead to a nasty surprise when you return the car.
While normal wear and tear is acceptable, the better condition you can keep the car in, the less you’ll end up having to pay out in the end.
Some contracts will stipulate when and where you need to get the car serviced. If it’s in your terms and conditions, it’s best to keep on top of it and avoid any penalties.
Aftersales care can make all the difference – what happens when something goes wrong?
It’s better to deal with a company that has a reputation for great support after the car has been handed over.
Online recommendations are a good source of information when considering a car finance company and its aftersales service. They can help you make up your mind about the product, service and how a company performs after the sale. Look for established companies, like Hippo Motor Finance which is part of Hippo Motor Group, with solid reviews.
If you want to investigate further, you can see if the business is affiliated with any associations too, such as the BVRLA, the UK trade body for companies engaged in vehicle rental, leasing and fleet management.
A serious finance and leasing broker that you can trust will listen to your needs – actively ensuring that all bases are covered in relation to the finance, the vehicle and supply professional solutions.
Don’t get caught out by car finance companies that don’t have your interests at heart, choose Hippo Motor Finance for a car finance experience that you can trust. Apply for finance today.
We expect more than 51% of our customers to achieve this rate.
|Loan Amount||Total Cost of Credit||Representative APR||60 Monthly Payments||Deposit Amount||Loan Term||Total Amount Payable|
|£7,500||£3831||19.1% APR||£188.85||£0||60 Months||£11,331|
We are a broker not a lender and our registered office is Trident Park, Trident Way, Blackburn BB1 3NU. Our contact number is 01254 919000