The Financial Regulator has published a new car finance cost survey that shows consumers can make significant cost savings by shopping around.
The Regulator also suggests that borrowers should consider the cost and benefits of any associated payment protection insurance that they are offered.."
The survey compared the cost of finance for two hypothetical consumers.
The first scenario was of a consumer borrowing €13,000 over three years for the purchase of a 2003 Ford Focus. The overall cost of the finance ranged from €1,582 to €2,079, showing a potential saving of almost €500.
In the second scenario, the borrower needed €22,000 towards the purchase of a €35,000 Landrover Freelander Jeep. The cost of the finance ranged from €4,290 to €5,300 - a difference of over €1,000.
Sharon Donnery, head of Consumer Information with the Financial Regulator, said borrowers should be aware of the type of agreement they are entering into. In particular they should note the difference between hire purchase, where they do not own the car until they make the last payment, and a car loan.
Copies of the car finance cost survey are available by phoning the consumer help-line on lo-call 1890-777777, by visiting www.itsyourmoney.ie