Car buyers looking to purchase a vehicle on finance have been urged by AA Personal Loans to shop around for the best deal .
The AA Deals on Wheels report has revealed that one in three people will finance the cost of a car using a loan during the next year.
Recent rises in interest rates have made this a more expensive option for buyers a factor that may be linked to a 16 per cent slide in demand for used cars since the start of the year.
But, the demand for brand new cars has increased significantly due to factors such as reliability, running costs, comfort and environmental concerns.
The report shows that 33 per cent of drivers are aiming to buy a newly registered vehicle over the next year, compared to 26 per cent in 2006.
Lloyd East, Head of AA personal loans, said: "As interest rates rise, UK consumers are beginning to tighten their purse strings. But our research shows strong consumer demand for new registration cars ahead of September 1st."






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