When the time comes for a new vehicle, it is understandable that motorists get stressed and anxious as there are so many different buying options to choose from. Here is what you need to know about each type and which type of motorist it is best suited to:
Buying a new car can be very expensive, but you get the luxury of being the only owner and you receive the full manufacturer’s warranty. In addition to this, the latest cars have all the best technology and are more economically friendly. If you have the money and are interested in the newest automobiles, this is a great option.
The majority of motorists purchase a used car. This is understandable, as it is much more affordable and you have an enormous range to choose from as the used car market is so large. With a little research, you should be able to find a great deal on a high-quality automobile either from a private seller or used car dealership. Buying used is beneficial for those on a budget but want to own an automobile.
Personal contract hire (PCH) is, essentially, a long-term rental (typically 2 or 3 years). You pay fixed monthly repayments and then simply return the car at the end of the agreement. This is a great way to drive a new automobile every few years, plus you do not have to worry about depreciation. If you want to drive a new car and are not concerned with ownership, PCH could be the best route.
Alternatively, you can finance the purchase either through personal contract purchase (PCP) or hire purchase (HP). PCP is similar to PCH but allows you to make a balloon payment at the end of the agreement where you then own the vehicle. HP involves paying the entire value of the car over monthly instalments. If ownership is important but you do not want to pay a huge sum up front, financing is probably the best option.
Finally, if you only need a car in the short term then you should look at rentals. Rental companies allow you to lease a car for just a few hours, for a few weeks or perhaps a couple of months. This is only advisable if you are looking for a short-term travel solution.
It can be tricky to know the difference between the types of buying options and which is best for you, but hopefully this guide will help you to decide on which path to take.