Purchasing a new car can be a very exciting time, particularly if you are finally getting rid of that unreliable old banger that has been causing your stress and costing you money for many years! However, for most people buying a new car means having to take out finance, and this is the part of car purchasing that can become quickly confusing and frustrating. However, there are a few different options available to those looking for car finance, and a number of steps that you should consider when considering getting finance for your car.

How to finance: There are a number of options open to those that want to take out a car loan. You can check with your bank to see what they have to offer in terms of car loans, and for homeowners there is the additional option of taking out a secured loan, which will mean the availability of longer repayments terms and lower monthly repayments. You should check on the interest rates that are on offer to see what sort of loan will best suit your needs, and also by finding out how much you can borrow you will have a far better idea of the type of vehicle you should be looking at. When you take out a loan to purchase a car one of the major benefits is that you can get your car from any showroom, or even purchase privately, rather than having to purchase from a particular place.

1. Consider PCP: PCP or Personal Contract Purchase has become a popular option for many people looking to get their hands on a new car. This is where you take on a personal contract with a provider, whereby at the end of a specified term, such as three years, you can hand back the vehicle to the provider or you can choose to purchase it. Throughout the term and whilst you have the vehicle as part of the PCP you continue to make set monthly repayments on it.

2. Dealership finance: Some people decide to opt for finance through a dealership, but this something that you should carefully consider before rushing in. Often, dealership finance can work out far more costly, although for some consumers, such as those with poor credit, this may be the only choice and is likely to be very costly. This also means that you have to choose a vehicle from that particular dealership, which means reduced choice.

3. Taking out a personal loan: This can be in the form of a homeowner secured loan, or an unsecured loan. Financing you new car purchase via a personal loan will give you the flexibility to either buy from any garage or buy privately if you know about cars and what to look out for mechanically. As a 'cash' customer you may be able to negotiate a much better deal.

4. Finding a reputable showroom for your purchase: As with any other type of business, when it comes to showrooms there are less than reputable companies that will practically twist your arm to make you buy a vehicle, and then there are showrooms that will offer help and advice in assisting you to find a vehicle and will not rush you into a decision. In order to avoid ending up at a showroom with overly pushy sales staff, inflated prices, and a dodgy reputation you should ask around and even look at online reviews wherever available.

5. Extended warranty: Most reputable dealerships will offer some form of warranty when you buy a new or used vehicle. However, you will most probably be asked about taking out an extended warranty, and there are pros and cons to this. The downside is, of course, that it is all extra money and can be pricey. However, the obvious benefits are that you will be covered against certain problems and repairs for a longer period, which can offer real peace of mind particularly if you are buying a used car.