Car buyers should consider their finances reveals new research

New research from Sainsbury's Finance reveals that many car buyers aren't considering the full cost of their purchase.

According for figures in Sainsbury's Finance Car Buying Index, nearly a quarter of people who plan to buy a car in the next six months will get into debt to do so. The research reveals that many people are considering credit before alternative methods of raising the necessary funds, such as selling a car.

The figures also reveal that there has been a sharp increase in the number of people looking to buy a car in the six-month period ending in August this year. New registrations made during this period will be the last to have a '10' licence plate.

Some half a million car buyers are expected to take out a loan that covers 100% of the value of the car.

Consumer advice site Think Money has warned people that they should try to minimise the amount of credit they take on when purchasing a new car. A debt expert from the site commented that "A lack of availability of car loans has prevented many would-be buyers from making a purchase over the past year or so, but this is changing."

"As with any borrowing we advise people to only take out a car loan if they are positive they can afford all their repayments."

The new interest in purchasing a car via financing solutions is possibly linked to an earlier report from finance company Deloitte. Their survey revealed that the availability of loans for car purchases was expected to rise over the next 12 months.

John Child, West Yorkshire, Caterham 7

Wendy Goh, London, BMw 325D M Sport