With an average of 590 monthly searches on Google and 40 commonly asked questions related to the topic on consumer insight portal Answer The Public, there’s clearly plenty of interest around vehicle finance.
To help give you a better understanding of this subject, vehicle hire specialist Long Term Van Hire walks us through the answers to five of these key questions around vehicle finance.
What’s the meaning of vehicle finance?
Vehicle finance affords people the opportunity to pay for the costs of a vehicle over an agreed period of time as buying a vehicle outright via a once-off cash purchase is something just out of the reach of most would-be motorists.
Who qualifies for vehicle finance?
While there isn’t one universal answer to this question, vehicle finance eligibility depends on the lending criteria of the lender, the terms of sale put forth by the seller, as well as the personal financial circumstances of the individual seeking the finance. There is a plan of repayment that has to be followed by the borrower and respected by the lender. Violation of this plan in the form of defaulting on repayment or wrongful repossession can have serious repercussions, which a Massachusetts Repossession Lawyer would be able to better explain. In any case, there are a few different options available to each would-be driver to find a way to access the vehicle they need.
- Hire Purchase (HP): You put down a deposit upfront and proceed to pay off the remainder of the vehicle through monthly installments.
- Personal Contract Hire (PCH): Also known as Personal Leasing, with PCH you rent a vehicle over an agreed-upon period of time and then you hand it back once the period has lapsed.
- Personal Contract Purchase (PCP): You pay a deposit for the vehicle and complete payments on a monthly basis over an agreed-upon period of time. When the term lapses, you can keep the vehicle, trade it in to get a replacement car or you can return it.
How long does it take to get vehicle finance?
Usually, no more than 48 hours is enough to get vehicle finance, but certain aspects will need to be clarified by the credit assistance provider, including ensuring that the loan-offering falls in line with your requirements and objectives and ensuring that no immediate or future significant risk of financial hardship will result from the granting of the loan to you.
What are the requirements for vehicle finance?
Your credit score affects the financing rate offered to you, validated by the following which you’ll need to bring to the dealership:
- Driver’s licence.
- Insurance card.
- Your two most recent pay slips.
- Proof of residency (utility bill which has your name printed on it).
- A list of references (each of these individuals should be referred to with their name, address, and contact number. These individuals should not live in your household).
Any trade documents you may be required to produce (with a title and registration).
How do I transfer vehicle finance?
If you’ve identified the need to get a new vehicle and your current vehicle still has some outstanding finance on it, you can either settle the finance by paying it off early, make an enquiry with the dealer to perhaps have them settle the finance, or you could make use of the Halves and Thirds rule if applicable (voluntarily terminating your agreement if you’ve already paid at least half of the total amount).