A new survey by online car sales site Carzone.ie has found that 47 per cent of Irish car buyers will use a car loan or other financial product to fund their purchase.
Many uncomfortable with understanding finance
That's in spite of the fact that many do not feel comfortable that they fully understand the way in which various car finance packages work. 42 per cent of drivers between the ages of 18-24 admitted they don't have a good understanding of the finance options when purchasing a car.
Carzone's research found that people are holding back from some finance packages because they are unsure about whether or not they own the car outright (39 per cent); being uncertain about the deposit and lump sum required at the end of a PCP agreement (30 per cent); and reservations about committing monthly payments (25 per cent).
Majority go to Credit Unions
In terms of where people go for their money, 61 per cent will go to their local Credit Union; with a third (33 per cent) preferring a personal bank loan. Other preferences by car buyers were hire purchase via dealership (27 per cent) and PCP (24 per cent).
Interestingly, given that carmakers and dealers increasingly focus on the monthly repayments of a new car finance package, the majority of buyers - 49 per cent - said that their biggest concern was the overall cost of the vehicle. Only 30 per cent said that the monthly repayment cost was their greatest concern, while 11 per cent cited concerns over the interest rate, and 6 per cent each said that the total loan duration or the size of the deposit were their biggest worries.
Online finance forms
Buyers are switching on to the idea of committing to finance online, though. While 43 per cent said that they would prefer to speak to a dealer about finance, 40 per cent said that they were happy with an online form.
Commenting on the latest report, Karl Connolly, Audience Manager at Carzone said: "This research investigates the concerns of Irish motorists when it comes to using car finance to purchase their next car. It is clear, especially in younger drivers, that a lot of potential car buyers don't fully understand how car finance works and what the best options might be for them as individuals. The data tells us that a greater effort must be made to ensure that Irish drivers have a better knowledge of what options are available to them and how to avail of these services, in order to better serve those looking to buy, sell and trade."