There are several different types of truck loans available from a wide range of lenders, so it can be difficult to know where to begin. That's why Auto Trader has teamed up with MoneyExpert.com to compare the truck finance market and do the hard work for you.
We cut through the jargon and confusion to help bring you the best options for your truck finance needs.
Based on the answers you provide, our comparator searches more than 200 lenders to deliver you a great finance deal.
When comparing, start with the Annual Percentage Rate (APR), which includes the overall rate of interest plus any other changes you'll be paying. Be aware that even when a loan has a very low 'APR Typical', this may not be the rate you're offered. APR Typical means that more than 66 per cent of successful applicants are eligible for the rate. Factors such as how much you earn and your credit history will be used to determine this.
It's important to check the charges and features included in the APR, as well as any penalties you may incur if you want to repay the loan early. You should also check what the monthly repayments are and the overall sum you're paying back.
We compare more than 200 personal loans online and more than 90 per cent of secured/homeowner loans. Our top lenders include the likes of Alliance & Leicester, Barclays, NatWest, Lloyds TSB, HSBC and many more.
Taking out a loan means the truck is yours the minute you drive off the forecourt, which is an appealing alternative to hire purchase agreements that ensure the truck belongs to the dealer until the final payment is made. However, with a loan, the debt is also yours and that's why it's important to make the right decisions before signing on the dotted line.
If you are going to buy an expensive truck and need to borrow in excess of £25,000, a secured loan may be your only option as few lenders will take the risk of offering you an unsecured loan. You would normally expect to pay interest of around 7.8 per cent to 17.9 per cent on a secured loan.
Typically, unsecured loans go as high as around £25,000. Rates start at around 7.9 per cent, which means on a loan of £15,000 over five years you'll be paying £303.41 a month.
Fixed or Variable Rate Loan
The most common personal loans are fixed, which means repayments are set at an amount over a specific period of time. Variable loans have interest rate which are dependent on the bank base rate and could fluctuate.
Only borrow what you can afford. Consider whether your current income is sufficient to cover the debt you take on. Consider how the debt will affect your disposable income and whether you will have enough cash to live on every month. Remember to take into account your current debts and also any savings schemes you are currently paying into when making these decisions.
Shop around and think about the terms of the loan. If you take on the loan for a long period then in most cases your monthly repayments will be small, but you will ultimately end up paying more as the debt won't shrink rapidly. If you take on a short term loan then you'll probably pay a high monthly rate of repayment but will clear the debt quickly. You need to find a happy medium for yourself.
One of the most important hidden charges with any loan is the early redemption penalty. It sounds scary but put simply it means you'll get hit with a fee if you decide to pay off the loan early, or move your borrowing to a different product or provider. If you can find a provider that won't charge then great, but the majority will so you'll need to be flexible.
Take stock of your own finances and try and work out why you can't afford them. Are you spending extravagantly elsewhere? Could you budget better? If you're really struggling the best thing to do is tell your creditors. Burying your head in the sand is likely to make matters worse.
The sooner you explain your situation to your lender, the sooner both parties can arrange the best way of getting things back on track. If you're still struggling, consult the Citizens Advice Bureau or debt charity Credit Action.
Payment Protection Insurance
There's a good argument for taking out insurance. It certainly gives you peace of mind in case you face unemployment, accident, sickness or death. However, Payment Protection Insurance (PPI) can be extremely expensive so it's a good idea to shop around some independent brokers rather than just accepting what your lender is offering.
Cancelling a credit agreement
Most credit agreements can be cancelled provided you act quickly. There will normally be a cooling off period of a couple of weeks in which you will have the opportunity to think about the conditions of the loan. You lose this right if you sign the documents on the dealer's premises, however.
The agreement can be legally terminated at any time, if you are not the owner of the van until the last payment is made (as is the case with Conditional Sale and Hire Purchase agreements). Provided you have paid half the credit price of the van, you can simply hand it back.
However, you will lose all the payments you have made, and will be liable for further charges if the van is in a poor condition. If you haven't paid half of the credit price of the van, you will lose the van and still be liable for any outstanding payments, which is the worst case scenario of a credit agreement.
Unable to make repayments
If you do get into any difficulty, honesty is always the best policy. It will be much better for everyone if you face the problem head-on, because by ignoring it, you could be put yourself and your family in serious trouble.
If you take an unsecured loan, bear in mind it does not stop lenders from going to court and making you pay one way or another which could lead to a black mark against your name, such as CCJs. Check the small print of your loan and check what could happen if you miss a payment.
When you apply for a loan, the lender will build a credit score around your application to decide if you are a reliable borrower. They will examine your current and past credit commitments and how well you have met them before deciding whether to give you the money
From this credit score they will derive a number which represents an acceptable risk for them to take on. If your score meets or exceeds this number then you should get the money.
Don't go out straight away and apply for other loans, as this will show on your credit report and will make you look desperate to other lenders. Instead, take the time to find out why your loan application was unsuccessful; it could be that your credit report contains errors which you are entitled to amend. Alternatively wait until you are promoted or take a better job before re-applying.
Run a free credit check report and check the information is accurate and if you spot mistakes report them to the agency. Maintaining the accuracy of your report can be particularly important if you have had serious financial difficulties in the past such as voluntary agreements or a bankruptcy. As soon as you meet the terms of these agreements ensure you send the documents to all the relevant people including the credit agency.