Where would you go to get a new car? The car supermarket? The Audi dealership? A car auction? Well now you can also go to the Post Office (postoffice.co.uk), thanks to the Post Office Car Loan. While you can’t actually drive a car away from the post office, or even choose a vehicle there, you can use them to apply for a loan enabling you to purchase a new or used car. With a typical APR of just 7.4% for loans between £7500 and £14,999 this is a cheap way of getting your dream car.
Buying a car with a loan makes a lot more sense than it did a few years ago. Interest rates have fallen so much that buying, even with credit, now makes a lot more sense than leasing. As you own the car too you don’t need to worry about giving it back to the leasing firm when your contract expires too.
The Post Office allows you to borrow between £2000 and £25,000 for a car, with interest rates pegged to how much you want to borrow. If you need less than £5000 then the rate is much higher at 14.9%, but is just 8.4% between £5000 and £7,499 and over £15,000, and at the low 7.4% between £7500 and £14,999.
You can even take repayment holidays twice a year, but need to define these in advance. Plus the car loan is available to those with low income, with a minimum annual income of just £8000. As long as you’ve got a good credit rating, are 21 or over, and have lived in the UK for the past three years you have a good chance of being accepted.
You can borrow the money for between one and seven years, allowing you to choose a monthly repayment figure that suits your budget. You can even choose which date you make repayments on, allowing you to time them in line with your salary payment.
