Galway Advertiser 2001/2001_02_08/GA_08022001_E1_019.pdf 

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Motoring
Financing your next car
rish c a r b u y e r s n o w h a v e a n excellent choice of quality c a r s , w i t h t h e availability of reasonable-cost finance a n d t h e b e t t e r prospects t h a t most people have in this T i g e r economy w h i c h is t h e envy of t h e m a j o r i t y of c o u n t r i e s in t h e w o r l d . many instances), r o a d tax, servicing, a n d other running costs such as petrol. R e m e m b e r too that the day y o u buy is the d a y y o u sell s o k e e p an e y e o n t h e depreciation cost factor. It has never before been more relevant than at this time. YOUR FINANCE OPTIONS B a n k L o a n s - T h e money you borrow is lent to you personally and the c a r you b u y with this loan is yours from day one. O n e other advantage of a bank loan is that you can repay a l u m p s u m ahead of schedule without penalty. T h i s is n o t the c a s e with hire purchase leasing. A d i s a d v a n t a g e is that rates m a y not fixed and m a y vary upwards (but also d o w n w a r d s ) . T h e r e are no tax relief a d v a n t a g e s a t t a c h e d to p e r s o n a l l o a n s as with leasing. H i r e P u r c h a s e - Here, the finance company owns the vehicle and the c u s t o m e r s rents it from it for a specified time. O n c e the period expires, ownership of the c a r passes to the customer. T h e customer taxes a n d insures the car, and as long as they advise t h e finance company, they are even free t o sell it too. T h e A P R in a H P a g r e e m e n t often requires u p front p a y m e n t s , a n d there is a documentation / arrangement fee. L e a s i n g - You b u y the car, and the leasing company pay t h e garage for the car retaining ownership until the final payment b u y s out the lease. Until that time the car is the property of t h e leasing company. Businesses, the self-employed, etc, have the advantage of claiming tax relief on the lease p a y m e n t s . T h i s is not possible with bank loans. Rates are fixed for the duration of the repayments. PCPis designed to keep y o u in a n e w car e v e r y t w o t o t h r e e years w h e r e y o u r c o s t is f i n a n c i n g t h e difference b e t w e e n y o u r o l d c a r a n d t h e n e w o n e , n o n e of which y o u o w n unless y o u want to p a y a l u m p s u m at t h e e n d o f y o u r n o r m a l repayment schedule to buy the car you drive on a P C P type of finance scheme. C r e d i t U n i o n L o a n s - provide a source of low cost finance for m e m b e r s w h o are allowed to borrow in a ratio related to the level of their savings. Check-out your local C r e d i t U n i o n f o r full d e t a i l s o n h o w b o r r o w i n g works for existing a n d n e w members. C o m p a r i n g like w i t h like - Borrowers should ensure that they are comparing like with like (eg unsecured loan versus lease o r hire purchase). You should be aware of the full cost of credit (ie monthly repayments by t h e n u m b e r o f r e p a y m e n t s p l u s additional charges / balloon payments (ifapplicable) as well as any up-front payments. P a y m e n t P r o t e c t i o n I n s u r a n c e is worth considering where available. This is particularly the case in protecting against i l l n e s s , loss of e m p l o y m e n t , e t c , w h e r e y o u r a b i l i t y t o r e p a y is r e m o v e d temporarily or permanently.

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T h e r e ' s nothing like t h e feeling you g e t w h e n you buy a new car, even if it's only new t o you. And t h e r e ' s nothing like t h e freedom you g e t from a Bank of Ireland Motorloan. With Motorloan you have all t h e bargaining power of a c a s h buyer, which is good. And unlike s o m e other forms of finance, t h e car you buy is yoursfrom day o n e , which is better. B u t b e s t of all you benefit from our competitive r a t e s , from 9 . 9 % (Fixed APR * ) . S o call into any Branch of Bank of Ireland or p h o n e u s on 1 8 5 0 3 6 5 1 0 0 today a n d g e t t h e c a r you've s e t your heart on.

Supplement

February 8 2001

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In the c o m i n g m o n t h s w e will witness tens of thousands of sales of new a n d used cars nationwide d u e primarily to the continuing positive economic outlook, consumer confidence, the expansion of compulsory vehicle testing to include cars up to four years o l d a n d for used c a r b u y e r s , t h e b e t t e r v a l u e in t h e m a r k e t compared t o last year. Trends suggest that t h e cost of loan financing is unlikely to increase further in the short term. Indeed, rates m a y fall back a little. In a d d i t i o n , w i t h increased c o m p e t i t i v e n e s s in t h e m o t o r f i n a n c e market coupled with the buoyant economy, new & q u a l i t y u s e d c a r a f f o r d a b i l i t y at current levels are likely t o prevail. In the last year interest rates have shown an u p w a r d t r e n d , b u t r e c e n t l y t h e y h a v e levelled out, and with a competitive market out t h e r e , t h e y a r e f a l l i n g b a c k a l i t t l e again. However, because of bad experiences in the past, such as the currency crisis which sent m o r t g a g e s r o c k e t i n g , w e s h o u l d b e much wiser about p e r s o n a l financial management. Firstly, consider y o u r general financial position, t a k i n g into a c c o u n t w h a t effect any future rate i n c r e a s e s w o u l d h a v e o n your mortgage for example, and a n y other influences that might effect your ability t o meet all you financial obligations. AH that said, t h i s is t h e g o o d t i m e t o take out fixed rate finance o n a m o t o r vehicle. At this particular time, over-supply in t h e u s e d v e h i c l e m a r k e t m e a n s t h a t values have fallen a n d this presents great opportunities t o buy a pre-owned vehicle at good value prices. It is a b u y e r ' s m a r k e t again. The individual o r c o m p a n y trading in a vehicle in the one to five year old range is paying much more to change for a n e w model this year than a year a g o . T h i s a n d over-supply a r e t h e main reasons that used cars and vans are better value. Regardless of what car or van you decide t o buy, you should shop around for the b e s t rate a n d w o r k o u t t h e e x a c t repayments to ensure the rate that looks the best is in effect the plan by which you will have paid the least overall s u m w h e n a l l payments have been made. You s h o u l d e n s u r e that y o u h a v e full details of your finance agreement, important factors such as any balloon payments (large final p a y m e n t s ) that y o u may n o t b e a w a r e of at t h e e n d o f t h e specified number of re-payments. Always compare like with like and don't be rushed into accepting any financial loan or lease package without comparing it with other options available. O n e thing is clear, reasonable rate finance is c u r r e n t l y available a n d if y o u n e e d t o c h a n g e y o u r car or b u y your first c a r ( n e w o r second hand), then this is the good time to d o s o . Again, that is if you can afford it. R e m e m b e r the additional costs besides the vehicle p u r c h a s e price i n c l u d i n g insurance (which c a n b e very expensive in

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