The car finance industry is booming, and more people than ever take out finance on their next car purchase. Even though car finance is so popular, there are still many car finance myths which many drivers are still unsure on. Use our car finance myth buster below and find out which are true, and which are false!
Car Finance Hurts Your Credit Score.
FALSE.
Many people think car finance has a negative impact on your credit score, but it can only impact your credit if you don’t stick to the rules of your agreement. When you take out car finance, you agree to meet all repayments. If you fail to do so, it can have a negative impact on your credit score. However, if you use your finance deal correctly, make your payments on time and keep up to date with any other payments you may have, you can actually use finance to better your credit!
You Can Finance New & Used Cars.
TRUE.
For a long time, car finance was only every associated with brand-new cars. However, car finance deals are not provided for both new and used cars. Buying a used car on finance can help to make your deal more affordable and it means you don’t have to empty your savings account just to buy a car. Save your money for the next rainy day and let car finance help you to maximise your financial situation.
You Can’t End A Car Finance Deal Early.
FALSE.
Many people think once you get a car on finance, it’s hard to get out of. However, you have the right to end your car finance agreement early through Voluntary Termination. You can walk away from the agreement at any point, under certain circumstances. Providing you have paid more than 50% of the Total Amount Payable and there is no damage to the vehicle you can hand the car back to the dealership and end your agreement.
You Can Negotiate A Car Finance Deal.
TRUE.
When you’re shopping around for car finance, a car payment calculator can help you get an idea of what your deal could look like before you apply. You can negotiate the interest rate of the deal by putting in a higher deposit or reducing the loan term, so your interest rate comes down. Alternatively, you can shop around for the best deal offered by lenders and find the one that’s best for your situation.
You’ll Get Declined For Car Finance With Bad Credit.
FALSE.
Ok so you can be declined finance if you have bad credit, but it doesn’t mean it’s impossible to get a car finance deal with poor credit. Car finance has become more accessible in the past few years and deals like hire purchase can be bad credit friendly. Granted, you won’t get the best deal with poor credit as you would if you have a perfect credit record, but it can still be possible. Before applying for bad credit car finance, we do recommend trying to improve your credit first.
You Can Get Car Finance Online.
TRUE.
Gone are the days of dealership only car finance! There are now many online finance lenders and brokers who can sort you finance in an instant. Make sure you do your research first and check out reviews form other customers who have used these online companies to make sure it’s legit. Sorting your finance online can mean you secure a deal that’s right for you but then shop for the car from a dealership with your finance deal already in place. Not only that but you can also trade in a part exchange, refinance your car and
No Comments