Motor vehicle finance is the ultimate solution to own your dream car without paying a large amount of money altogether. The process generally involves a lender or a third party who helps you with the various financial products by which you can negotiate the money with your previous dealer. Whether you are an individual or a business owner, anyone can avail the motor vehicle finance, but the market share may vary from person to person. Vehicle finance allows the buyer to pay for the car through easy and affordable monthly installments and buyer can also chose the tenure of the finance.
Personal Motor Vehicle Finance
Personal motor vehicle finance is a branch of the personal finance which comprises of various financial products such as automobile loan, automobile hire, direct car purchasing, car leasing etc. Thus, motor vehicle finance covers a vast arena and is not just restricted to car leasing.
Reasons for availing Personal motor vehicle finance
- Every person dream of having their own car but many people cannot afford to do that due to the financial crisis. In such circumstances, motor vehicle finance comes as a savior.
- If you want to avail the personal motor vehicle finance, you must know that capital for purchasing your automobile will be funded by a bank. In some cases, some financial companies which deal with buying and selling of cars can also come as a helping hand and contribute to your personal automobile finance.
- There are certain automobile companies like Ford, General Motors etc which owns their own automobile financing sections for lending loans to buyers.
- In most cases, once a deal is finalized with an automobile manufacturing company, the auto dealers quote a high rate of interest from the buyers which are mostly decided by the company itself. This process is known as dealer markup.
- Dealer markups are highly advantageous for the dealers as they allow the dealers to receive compensation in case of need. This also causes a disparity in charging the rates to different consumers irrespective of the importance of their credit. Moreover, if a consumer has a bad credit history, might not get the finance.
- In case of motor vehicle finance, the lender of funds may claim the occupancy of the automobile during the contract term although this is valid only for certain types of financing and not all.
- In the case of business properties, the ownership by a third party is more prominent than that of the personal assets. The leasing of the car to the one who is taking the possession is also more typical in case of business assets compared to personal ones.
- The motor vehicle finance is supplied by the dealer in most cases from whom you are purchasing the car, but sometimes they can also be given by brokers or money lenders who will get a lump sum as a commission after arranging the loan.
Spot financing
This is the system by which an automobile is delivered to its buyer even if financing on the automobile is not finished. This term can be frequently heard in motor vehicle companies. This is a wonderful opportunity of the dealers to make a huge sum of money through financing on the automobiles as they specifically work on weekends or post working hours of the banks so that they can send the car to their buyers when the banks have still not issued the final approval. This prevents unnecessary delays and you can get the delivery of your car even on a bank holiday or other public holidays. Thus, through motor vehicle finance you can own your dream car without any hassle.
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