If you need a van, you need a van and it’s as simple as that, but many people are unwilling or unable to outlay a large lump of capital, which is where used van finance deals come to the fore. With largely low interest rates and a wide selection of vans to choose from it has never been easier or indeed cheaper to get the van you need quickly and easily but what options are there in the market? Read on to find out more:
- Hire Purchase (HP) – A hire purchase agreement entails hiring the vehicle from a lender until the agreed balance is paid off in full at which time the ownership is transferred to you. If you select HP, you can pay a deposit which lowers monthly payments. The loan is secured against the vehicle so if any payments are missed the lender can repossess the car. Although HP is a very convenient option and widely available, the monthly repayments do tend to be high in comparison to most other used van finance deals.
- Personal Loan – Taking out a personal loan is another popular way to secure finance for the purchase of a vehicle. The main benefits of using a personal loan to buy a vehicle are you can sell it at any time without being obligated to a finance company. Potential disadvantages of taking out a personal loan for a vehicle purchase include possible non-eligibility for bad credit/no credit history and the risk of buying a vehicle that is not for purpose. *(HP providers and used van finance deals specialists will generally have a list of approved dealerships.)
- Personal Contract Purchase (PCP) – Similar to HP agreements, you can pay a lump sum at the start of the agreement followed by monthly payments until the balance of the loan has been settled. In contrast to an HP agreement at the end of the fixed term (usually 24-48 months) you have the option to return the car and use the accumulated equity toward another vehicle or take ownership of the vehicle by paying the GMFV (Guaranteed Minimum Future Value) otherwise known as a ‘Balloon Payment’. Benefits of PCP include lower monthly payments (due to GMFV payment at the end) and the option to keep the vehicle or hand it back. Disadvantages of PCP include mileage restrictions and vehicle damage fees if you decide to hand the vehicle back. The ‘Balloon Payment’ is another factor that could be cited as a disadvantage.
- Van Finance Specialists – Companies that offer new and used van finance deals as the main focus of their business model are often able to offer a range of finance options from a wide network of lenders. These specialist companies (such as Used Van Finance Deals) are often able to offer bespoke finance packages and can sometimes offer finance to those with a less-than-perfect credit history.
If you are looking for competitive used van finance deals, please complete the form on our contact us page and we’ll get right back to you. Alternatively, give us a call using the number at the top of the page.