There are 2 main types of car loans, Secured Car Loans and Unsecured Car Loans. A secured car loan provides the lender with an item of security; in the event that you cannot repay the loan, the lender can take possession of this item, which, in the case of a secured car loan is usually the car itself. Unsecured loans do not require an item of security. These loan tends to have higher interest rates and the loan amount offered is usually smaller.
Speciality Car loans are aimed at a different group of people, offering advantages from which they would benefit. A specialised loan offers advantages from which one particular group of target customers would benefit. Specialised loans are either secured or unsecured. Many lenders offer: Student Car Loans, which often allow students to postpone repaying the loan until they have completed their studies; and used car loans, which give you the freedom to choose from a wider range of cars. It is not always advantageous to apply for a specialised car loan, even if you fit into the target consumer group; although there may be additional benefits, these are often counteracted by unfavourable terms in other areas. For example, although a bad credit loan may allow you to borrow a larger amount than a normal loan, the interest rate will be much higher, and will cost you much more.
Choosing the right car loan can save you one can save you hundreds or even thousands of pounds. It is important to shop around, as car loans vary hugely. Loans are offered by banks and building societies, online car finance companies, and many supermarkets. Most of these lenders are now available to contact online, which makes applying for a loan quick and easy.