Killarney Credit Union recommends buyers read the small print in car finance

WITH the 171 car registrations around the corner, Killarney Credit Union are recommending that you read the small print of car finance deals before you sign on that dotted line.

One emerging trend in car finance is the introductions of Personal Contract Plans (PCPs) which are lot of garages are now offering. Essentially a PCP is a lease scheme which makes financing a new car seem more affordable with low monthly repayments.

“We have seen PCP finance becoming more popular over the past few years, people are attracted to the low APR rate, but the devil is in the detail and we always advise to look at all your options before you sign up for this type of finance” stated Helen Courtney Power, Business Development Officer with Killarney Credit Union.

Helen added “The issue with this type of finance is that you have to provide a deposit at the start and also a potential bubble payment at the end of the term. Also, you only own the car when you make the final payment, if you run into financial problems during the term, you can’t sell the car. You are limited if you want to increase payments or want to extend the term, you may be charged a rescheduling fee”.

Killarney Credit Union recommend that you take the time to compare the total amount payable on a credit union car loan (cost of credit) with the PCP cost (the deposit, plus monthly repayments and final payment). Also make sure you also compare the terms and conditions of each option before committing.