Overcast

Overcast

max temp: 19°C

min temp: 11°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

0 comments

Welcome , please leave your message below.

Optional - JPG files only
Optional - MP3 files only
Optional - 3GP, AVI, MOV, MPG or WMV files
Comments

Please log in to leave a comment and share your views with other Ipswich Star visitors.

We enable people to post comments with the aim of encouraging open debate.

Only people who register and sign up to our terms and conditions can post comments. These terms and conditions explain our house rules and legal guidelines.

Comments are not edited by Ipswich Star staff prior to publication but may be automatically filtered.

If you have a complaint about a comment please contact us by clicking on the Report This Comment button next to the comment.

Not a member yet?

Register to create your own unique Ipswich Star account for free.

Signing up is free, quick and easy and offers you the chance to add comments, personalise the site with local information picked just for you, and more.

Sign up now

Just one in seven domestic abuse cases in Suffolk result in a police charge, new figures reveal.

The Department for Education has today unveiled proposals to scrap SATs exams for year two pupils and replace them with less-pressured assessments.

It’s not too late to book tickets and take in a great show in April. Suffolk’s theatres have something for everyone throughout the month including music, movies, plays and cabaret. We have highlighted just a few of the entertaining events on offer.

Do you remember when Major’s Corner, St Margaret’s Green and Ipswich Cornhill looked like this?

It’s a tale of one man and his ferret as an Ipswich serviceman who lost his mother at the start of March prepares for a 73-mile walk.

Firefighters rescued a cat from a roof in Blythburgh today but had to leave safety sheets so a second moggy could jump down in its own time.

A Suffolk school has been ranked among the top 20% in the country for attainment and progress made by pupils between key stages of their education.

An East Anglian college is celebrating after scooping top place for the second year in a row in a contest to find the best water-friendly farming idea.

A Mondrian-inspired piece of artwork made of thousands of coloured blocks was snapped up at an Ipswich gallery within 48 hours.

Food editor Charlotte Smith-Jarvis takes her mum for a relaxing all-inclusive lunch at Hintlesham Hall.

Most read

Most commented

HOT JOBS

Show Job Lists

Topic pages

Newsletter Sign Up

Sign up to receive our regular email newsletter
MyDate24 MyPhotos24