Industry News from Yes Insurance

Motorists looking to drive away with a 2007 registered car this month may be running into debts financing it - other than tax and car insurance.

According to MoneyExtra.com, hire purchase is the most popular payment method when it comes to buying a new car.

However, it pointed out that such a deal may lead to high APR payments and that the car is not actually owned until the deal's end.

And while a personal contract purchase gives consumers the option to buy, trade or return their vehicle after a set amount of time - after only paying for a portion of it - the body suggested that a forecourt-free personal loan may actually provide the better option.

"By taking the time to arrange finance before visiting the forecourt, motorists can… be certain that they are getting more metal for their money," said Robin Amlot, senior editor at MoneyExtra.com.

Meanwhile, Alliance & Leicester has also found that taking out a loan may provide the best option when financing the purchase of a new car.

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