Undeniable Proof That You Need Car Finance

Are you still thinking about whether you need car finance or not? If you’re having trouble deciding on this, we’ll share with you some of the top reasons why you ought to consider getting car finance. Maybe these reasons are true for your situation right now. Hopefully, this article will be able to help you decide and get car financing. The sooner you do, the sooner you’ll get to enjoy the benefits of having your own car. 

You can’t pay in cash

If you want to buy a car outright, whether new or used, you’re going to need to prepare a large sum of money. Maybe you’ve saved up enough to make the purchase, and that’s great! You can definitely buy the car in cash. However, what if you don’t have enough funds yet but you really need to buy a vehicle? That’s where car finance comes in. 

You don’t need to have to wait so long so you can save up and buy the car you want. If you can’t pay in cash, you can get car finance and make the purchase. Car financing allows you to drive that dream car home while making the payments affordable. With car finance, the payment is spread over a period of a few years through monthly instalments. 

Depending on your financial situation, you can buy a car without even having to pay a deposit. However, if you want to have a lower monthly repayment amount, you can pay a significant amount as your deposit or downpayment. Whatever arrangement works for you best, car financing can make buying a car more affordable. 

You want a better car

Do you have an old car that doesn’t work so well anymore? Maybe it keeps on breaking down and repairs have been costing you a lot of money. Keeping and maintaining old cars are not only costly, but it’s also riskier for you to drive them. If this is your situation, then it would be more practical to buy a better car to replace the old one.

A new and better vehicle will give you peace of mind that it won’t break down at any given moment. It will allow you to save more money since you won’t be expecting it to need any repairs soon. You only need to ensure proper maintenance so that your car will be in its best shape for the longest time possible. 

Getting car finance will help you buy the new car you want. You can trade-in your old vehicle so you can save some of your funds for other car-related expenses like petrol and insurance. Securing car financing is so easy today that there’s no reason for you to not buy a better car and replace your old vehicle. 

You need a vehicle for your business

Maybe you have a thriving business and you now need a vehicle for it. The good part about buying a car for your business is that you can claim the cost since it is an allowable expense. For your purchase to be tax-deductible, you first need to be self-employed so you can claim tax relief on your car finance repayments. The vehicle should be used only for business purposes and not for personal use. 

If you use your vehicle to deliver goods, for example, then you’re using it for your business. However, if you’re going to drive it for personal use, then you’re not allowed to claim tax relief for the incurred car-related expenses. For more information about how car finance repayments can be tax-deductible, be sure to check the HMRC rules for the criteria governing how vehicles for businesses are treated when it comes to tax.   

You want to improve your credit score

At first, getting car financing may negatively impact your credit score. It’s because the car finance company will be conducting hard checks on your credit report. When this happens, it could knock off a few points on your credit score. However, as you make your monthly repayments for the duration of the contract, you have the opportunity to build your credit score. 

As long as you make your repayments on time every time, you don’t have to worry because your records will show that you are a good borrower who can make timely payments. If you can successfully do this for the full duration of the car finance contract, it can significantly improve your credit score. You will then be able to get better deals from lenders in the future.

What are the car finance requirements?

Do some of these reasons resonate with your situation? Maybe you’re now ready to take the next step and apply for car finance. Before you do, be sure to prepare the documents that you’ll need for the application.

First, you’ll be needing your driver’s licence as proof of identity. You may also use your passport for this but many car finance companies also want to ensure that you’re legally allowed to drive, so it’s better to have your driver’s licence. 

Second, prepare your proof of income. If you’re employed, you will need your payslips for the last three months. If you’re self-employed, you can show your bank statements. The purpose of presenting proofs of income is to show the lender that you can afford the monthly repayments for car finance. 

Lastly, prepare your address history for the last three years. As proof of address, you can use your utility bills as long as it shows your name and the full address in the document. Bank statements can also be used as proof of address.

When you have all these documents ready, you’re on your way to getting financing for the car you want!

Takeaway

Car finance allows you to buy a car for you, your family, or your business through affordable monthly instalments. The process of getting car financing today is simple and straightforward. It’s no longer tedious and confusing like it was a few decades ago. You can even apply for financing online 24/7 with Carmoola where you can get the result in just a few minutes. You’re just a few clicks away from getting your dream car.