How to Afford a New Car on a Tight Budget
Common sense might indicate that buying a new car and saving money are not compatible objectives. But it is possible to buy new (or, at least, nearly new) without spending an enormous amount. Let’s look at how.
The moment you drive a brand-new car off a forecourt, it’ll depreciate by several thousand pounds. As such, the used market is a great source for nearly-new bargains – but you’ll need to scour the listings in search of those bargains. This means a time investment is necessary, which isn’t ideal if you need a car in a hurry. Moreover, used cars, by definition, aren’t new, so you’ll need to be on the lookout for minor scuffs and blemishes.
If you know that you’re going to ultimately buy the vehicle, then there are many different forms of loan available that will break down the cost of the vehicle into regular payments over a longer period. Naturally, this option is costlier in the long term, as you’ll need to pay interest – but it’ll get you on the road quickly in a brand-new car.
Leasing a car is in many respects just the same as renting one. The main differences come from the length of the term. You’ll be paying a fee every month for an agreed contract, and at the end you’ll either give the car back or buy it outright.
Leasing agreements tend to come with a few stipulations. You’ll not be able to modify the car without permission, and you’ll need to return it in a respectable condition. Permission may also be required for any overseas trips.
There are two different sorts of leasing agreements: PCP (personal contract purchase) and PCH (personal contract hire). The former allows you to become the car’s legal owner at the end of the contract by paying a single balloon payment.
This is a form of credit, and as such you’ll be subject to a range of credit checks to ensure your reliability. For motorists who are able to pass these tests, leasing represents an attractive way to finance a new car purchase when there isn’t enough cash available at the start of the contract. You’ll need to also vet the firm providing the lease: reputable dealers like Zenauto will provide peace of mind that you might not get elsewhere.
This practice also allows the driver to pick up a new car every few years without having to worry about selling their old one – at the end of the contract, the car simply reverts to the ownership of the leaser, and, provided that the car is in good condition, no further costs are incurred.