Car Finance Agreement

You can borrow money directly from a bank, financial company or credit union. In your loan, you agree to pay the amount financed, plus a financing fee, over a specified period of time. Once you`re ready to buy a car from a dealership, use that loan to pay for the car. How does leasing differ from buying? Monthly payments for a lease are usually lower than monthly financing payments when you bought the same car. They pay to drive the car, not to buy it. This means that you pay for the expected depreciation of the car during the rental period as well as rental fees, taxes and fees. But at the end of a rental agreement, you must return the car, unless the rental agreement allows you to buy it. It`s important to remember that voluntarily terminating your auto finance contract doesn`t give you any money back. Thus, if you have paid 65% of the total amount of financing, you will not receive the refund of the additional 15% you have paid. This means that you must have repaid 50% of the total amount of financing. However, with an HP deal, you usually reach the 50% refund point by half of the deal. If you have not refunded 50% of the total amount of financing, you can pay the difference and cancel it.

The same rules for the car in good condition normally also apply to HP….