Refinancing
Understanding Refinancing
Refinancing is a financial strategy that involves replacing an existing loan with a new loan, effectively paying off the debt of the first loan. This often comes with settling your current finance through a one-time payment. It's a financial tool designed to enhance your financial flexibility and align your loan structure with your current circumstances.
Why Consider Refinancing?
Have an ongoing PCP or HP agreement: If you currently have a Personal Contract Purchase (PCP) or Hire Purchase (HP) agreement with a significant outstanding balance, refinancing can offer a more tailored solution.
Reevaluate Your Initial Deal: You may have taken out a deal in the past that seemed fitting at the time, but as circumstances change, so do your needs. Refinancing allows you to adjust your financial commitments accordingly.
Improved Credit Score: If your credit score has improved since your initial agreement, refinancing can offer you the opportunity to secure a better interest rate, potentially lowering your overall repayments.
Adjusting to Expenses: Life changes and sometimes your expenses increase. Refinancing can help you lower your monthly payments, making your budget more manageable.
Alterations in Joint Finance: If you initially took out joint finance and now prefer a loan that's solely in your name, refinancing is a way to restructure your financial commitments.
Refinancing A Balloon Payment
At the end of a PCP agreement, you face the decision regarding a balloon payment. This is essentially a lump sum representing the current value of your vehicle, agreed upon at the start of the deal. However, this sum can often be substantial and challenging to pay off all at once.
This is where refinancing comes into play. By opting to refinance, you can break down the cost of the balloon payment into more manageable monthly installments, ensuring a smoother and more manageable financial transition.
Let Us Tailor Your Finance
Refinancing give you the power to align your financial commitments with your current situation and needs. At Motor Loans R Us, we specialise in finding the most suitable finance options for you. Let us help you navigate your financial journey and tailor your finance to fit seamlessly with your life.
Ready to take the reins of your financial future? Apply Now or call our finance experts to find out how we can help you tailor your finance.