Motorists borrow to finance new car

Around a third of people who plan to buy a new car would get into debt to fund it, a new survey has revealed.

The Sainsbury’s Finance Car Buying Index found that 27 per cent of motorists intending to upgrade would get a loan to help them fund the deal.

Of the total amount spent buying new vehicles, 18.4 per cent will be financed through personal loans, the study estimated. This would be equivalent to a total of £9.14 billion.

The research predicted that spending on new motor purchases is set to increase, despite the actual amount of buyers going down.

Head of loans Steven Baillie commented: “People who do want to purchase a car are willing to spend an average of £300 more than they were six months ago.”

Rising fuel prices are an important factor in the current economy – the Office for National Statistics recently stated that petrol went up 1.2 pence per litre in July.