In car finance, the word term is used to describe the period of time that the car finance agreement will be carried out for - basically how long the loan period is. In most car finance companies, the term will be written in months or years. For example, a 36 month term.
The shortest term length finance product that Creditplus provide is 12 months. It is much more common to have finance over longer terms between 24 and 60 months, with the average term length chosen by our customers working out as approximately 56 weeks, which shows that the majority of our customers choose 48 and 60 month agreements.
The longer the term, the lower the monthly repayments will be as the cost is spread out, but you could also end up paying more overall if you choose a longer finance term to make repayments, as the amount you have borrowed will incur more interest. It depends on your situation which option is best for you. A short term loan would have higher monthly payments, but you would pay off the cost of the car quicker and pay less interest. A longer loan term length would incur more interest, however the monthly payments would be lower.
Deciding which option is right for you is down to your own personal circumstances. Our Customer Advisors will be happy to discuss the options available to you, but will leave the final decision to you. If you would like an idea of how much it could cost in advance of applying, you can use our car finance calculator to get an example of what your car finance package could cost. It includes options such as credit rating, amount you want to borrow, deposit, and term length.
For most of our products such as Hire Purchase and Personal Contract Purchase, the term is fixed.
Remember: Before you sign any finance agreement, you will be provided with a SECCI form that details the exact cost of the finance agreement before you sign.
If you want to change your term length, you may be able to refinance your package for an extended length of time. If you find yourself in a situation where you either want to extend the term, pay the finance agreement off earlier, or adjust your monthly payments, it is best to contact your lender directly to discuss your options. In all circumstances, you can call one of our Customer Advisors and they will be happy to answer any questions you have.
If you require further assistance, our team of Customer Advisors are here to help. We're open six days a week - you can view our opening hours here - and we're more than happy to answer your questions.