You need to buy a car but don’t have the money. Thankfully, your bank balance doesn’t mean you have to forfeit one of life’s main necessities. Car finance is on hand to provide the resources you require to own a vehicle.
Most people understand what the process entails, whether it’s opting for a hire purchase or a lease purchase with balloon payment. However, APR is something you’ll come across when searching for car finance and you might not know what it means. What is car finance APR? Keep reading to find out.
What is car finance APR?
The simplest way to understand APR is to view it as interest. The acronym stands for Annual Percentage Rate, and it’s the amount added on in interest yearly. It also includes any compulsory charges. APR continues to be included within your repayments deal until the deal is over and you either give the car back or own it outright.
How does it work?
APR works in the same way that most interest rates work. In terms of car finance, the dealership you choose will use a standard measure to calculate the amount of interest you need to pay. The higher the rate, the more you’ll pay back in the long-term.
What Can APR Affect?
Car finance APR mainly impacts how much you will pay over the course of a contract. The figure isn’t taken into account within the deal as it’s added on afterwards. Therefore, it’s essential to figure how much it is and whether you can afford it before signing on the dotted line.
Finance APR is a good indicator of offers as you can use the rate to compare quotes with other dealers on the market. For example, if everything is the same except for the APR, you could save a significant sum.
My Car Credit’s finance calculator
At My Car Credit, we recognise the need to be transparent, which is why we have a loan calculator tool you can use free of charge. If you ever wonder, ‘can I get car finance?’ you don’t need to wait too long to find out!
Of course, you can always contact a team member and discuss your options with them directly.
Rates from 6.9% APR. Representative APR 13.9%
Evolution Funding Ltd T/A My Car Credit
Require more help?
Got a question you can’t find the answer to, or need some advice and guidance around taking out car finance? Our Car Credit Specialists are friendly, experienced, and here to help so get in touch today!