Secured Car Loan

This is where the car is used as security for the loan. By doing this banks will offer lower interest rates as they have the security over your car. This loan suits people who have little or no business use of their vehicle. Loan terms can range from 1 to 7 years. Repayments can be reduced by having a balloon value at the end of the loan. When claiming business use, you claim the interest paid, not the entire payments made. You may also be able to claim depreciation of the car if your claiming business useage.

Personal Lease

This is ideal for people that have little or no business use of their car but require a lease, or rental, structure for their finance. In a lease, the bank is considered the owner of the car until the lease is finalised. Therefore the car is just an expense to the driver paying it off. Payments are considered to be Rental payments, not repayments. This makes claiming business use much easier as you just claim the business use percentage of the lease payment. The advantage of personal leasing over business leasing is that you can make use of a deposit and balloon payments are not mandatory. The car is always registered to the driver and full ownership takes place once the lease is paid out or finishes.

Personal Loan

A Personal Loan does not use the car as security. This is good for older cars that you cannot do a secured loan on, or even grey import cars. These can run for up to 7 years as well but do not allow you to have a balloon payment.

Personal Loans are also good for other goods like Boats, Caravans and Trailers, but can also be used for Debt consolidation, Travel Costs or many other useful purposes.