Car Finance Explained

What is conditional sale (cs)?

this is finance secured against the vehicle itself and you do not own the car until you have made the final payment – you can’t sell it without the lender’s permission, although you can return it.

You typically pay a deposit (often 10%) and then repay the balance in instalments, plus interest, over the loan period. At the end of the loan period, you own the car outright.

Be aware that: the car can be repossessed if you miss a payment.

This type of plan typically involves paying a deposit then low monthly instalments over a fixed period.

at the end of this, you can either pay a lump sum (‘balloon payment’) to purchase the car outright, return the vehicle or sell it privately to pay off the remainder.

be aware that: it’s important to stick to the agreed mileage limits and to keep the car in good condition to avoid penalties. You are hiring the car and will not own it until the balloon payment is made. It may be less cost-effective than CS if you plan to keep the car, however.