Partly Cloudy

Partly Cloudy

max temp: 16°C

min temp: 14°C

Search

Figure out best overall finance deal for you

PUBLISHED: 06:44 10 July 2014

Interesting advice: Simon Gray of Credo Asset Finance.

Interesting advice: Simon Gray of Credo Asset Finance.

Archant

Simon Gray, of Credo Asset Finance, says figure out the whole finance package not just the monthly payment.

Payment, payment, payment – what’s it going to cost me per month?

Well, how about asking a different question – how much are the interest charges?

So here’s a couple of examples on the same car which costs £22,000 and, with a £2,000 deposit, has you borrowing £20,000.

One – 48 months at £311.22 per month with a guaranteed future value of £9,573.80

Two – 36 months at £429.71 per month with a future value of £7,500.

Now budgets may dictate that we go for option one – it’s £118 per month cheaper after all. But which is better value?

Firstly, simply multiply the payments out – this gives option one repayments of £24,512.36 against £22,969.56 in option two – now which is better value?

Also the APR on option one is 8.1% against 7.5% in option two.

Now which one would you prefer?

The moral of the story is never be flattered just by the monthly payment – look at the finance package as a whole, look at the total you pay, look at the APR.

I would always suggest you pay up to your total budget, not below it. The more you pay per month – assuming the underlying rate is the same – the less finance charges you’ll pay. This will also impact on the equity you will have in your car when, and if, you settle early. And that will impact on the payments you make, or the car you can afford, when you come to change next time.

Sometimes, I’ll be first to agree, if your budget in this example is £315, then option one is probably the only deal you could do – and you’re getting into it for the right amount per month – but if not consider things in more detail.

If in doubt speak to a good, independent finance broker who can do all the maths for you and hopefully direct you to the deal that best suits you and your circumstances.

Credo Asset Finance is at 85 Yarmouth Road, Norwich, NR7 0HF. Phone 01603 703180, email sales@credoassetfinance.com, log on to the website at

www.credoassetfinance.com. Twitter: @CredoFinance, Facebook: www.facebook.com/#!/CredoAssetFinance

Sunday’s inaugural Great East Run will see 3,000 runners tackling the half marathon course around Ipswich town centre, out to Freston and back.

Officials behind the Stars of Suffolk awards are urging people to make nominations for carer of the year.

A lorry driver has been released without charge following his arrest on suspicion of drink driving after his vehicle overturned on a roundabout just outside Ipswich.

Talented graphic design students at the University of Suffolk have put pen to paper to come up with a fresh logo for a key project on their doorstep – the Ipswich Vision.

From rodeo bulls and Nirvana sing-alongs to help and advice from charities and businesses, One sixth form’s freshers’ fair was alive with activity from hundreds of students.

Police in Ipswich have been called to Dogs Head Street after reports of a man being aggressive.

The Great East Run has “endless potential” and should feature world-class runners among a 10,000-strong field well within a decade, a Team GB Olympic runner has said.

It is some time since the Labour Party went into a conference season with swagger and confidence – this year they very much do.

Doctors anticipating a severe outbreak of flu this winter are desperately urging vulnerable people in Suffolk to get vaccinated against the virus.

A person who died on the rail line near Ingatestone in Essex on Thursday has been named as 15-year-old William Tweed.

Most read

Show Job Lists

Topic pages

Newsletter Sign Up

Sign up to receive our regular email newsletter
MyDate24 MyPhotos24