Over half (60%) of Brits prefer to finance their cars with cash, according to new research from Go.Compare Car Insurance.
The insurance comparison site asked buyers about their usual method of paying for a vehicle, and cash was overwhelmingly the most popular. The second most common way to purchase a car was PCP finance, with 13% of buyers choosing it as their preferred payment option.
Meanwhile, bank loans, a way to finance any sort of large purchase, is only the usual method for 9% of Brits. Paying by hire purchase (7%) and paying by lease (6%) were the nation’s least popular payment options when it comes to obtaining a car.
Ryan Fulthorpe, motoring expert at Go.Compare, said: “It’s really important to consider the different available options when it comes to financing the purchase of a car. The method you choose may be determined by your available budget, as well as whether you’d be able to set aside money to make future payments.
“Paying by cash for a vehicle means you won’t have any pending payments, but it requires you to have the full amount up-front, which may limit what you can afford. Some choose a personal contract purchase due to its flexibility, as monthly instalments can be arranged to suit your budget. However, you must ensure that you’ll be able to keep up with the repayments.
“When choosing your financing method, you should also consider other car-related expenses. For example, the vehicle tax, any maintenance work, and the insurance. Thinking about these costs before buying your car means you can estimate a more realistic budget. Insurance can be one of the biggest factors, which is why we always recommend comparing providers to get the best possible deal.”
The report also reveals that over half (52%) of car buyers will purchase their next motor through a dealer. This allows them to see the car in person beforehand, and in some cases, to test drive it, which were the two main reasons why drivers wouldn’t choose to purchase a vehicle online from a car sales website.
In fact, when asked if they would ever buy a car from a car sales site, 46% of people said no. More information on the nation’s car-buying habits and advice for purchasing your next motor can be found on Go.Compare’s website.