Any frustrated commuter slumped over the wheel of a vehicle in rush-hour traffic knows only too well that car ownership is booming in the Republic.
By the end of last month 159,939 new cars had been registered this year. This compares with 145,715 for 1998 and 136,662 for 1997. The trend is moving upwards.
Remarkably though, car ownership here is still well behind most of our European neighbours: but not for long if the finance industry has anything to do with it.
"You can identify part of the increase in new cars over the past few years due to low interest rates and flexible finance packages," says Mr Alan Nolan of the Society of the Irish Motor Industry (SIMI).
"There is a significant increase in the number of young drivers confident in their job who are choosing to buy new cars with these schemes," he adds.
Next month AIB will make a renewed pitch for customers seeking to become mobile. Greater competition and lower interest rates are on the horizon according to Ms Elaine Darcy of AIB Finance and Leasing.
"A lot of motor dealers and bureaus have their own finance business managers now so the customer doesn't have to go to their branch to get a loan," says Ms Darcy. "Finance houses are looking to hold onto their own customers."
But behind the gloss what do the various motor loan schemes offer the customer? And how does each compare?
Irish Life & Permanent has offered customers specially tailored motor purchase plans for customers for at least seven years. Like most of the motor loans currently available, no initial deposit is required if the applicant is in steady employment.
However, an application which includes some element of self-financing is likely to be viewed more favourably, according to one Irish Permanent loan adviser.
Unlike most of the other finance houses, Irish Life & Permanent does not offer variable rates for motor loans but its fixed interest rate is reasonably competitive. The APR of 8.9 per cent is 1 per cent less than Bank of Ireland's motor-loan fixed rate although it is more expensive than First Active's APR of 8.5 per cent.
Irish Life & Permanent, like AIB, offers three different levels of insurance cover: Credit Life (which covers loss of life and costs £1 per £1,000 of loan), Credit Cover (which covers loss of life and sickness and costs £2 per £1,000 of the loan) and Credit Care (which covers loss of life, sickness and costs £3 per £1,000 of loan) and redundancy.
But while this offers customers greater flexibility it can add to the expense of the loan repayments. Comparing Bank of Ireland's full insurance cover on a £10,000 motor loan which costs £20 per month, Irish Life & Permanent's plan works out at £30 per month.
There is also a one-off £50 documents charge. According to Ms Valerie Bradshaw of Irish Life & Permanent this is not a hidden charge because it is clearly defined in the loan literature. AIB charges its customers the same documents fee while Bank of Ireland and First Active do not.
Bank of Ireland offers customers either a fixed rate of around 8 per cent or a variable interest rate of 9 per cent over a repayment period of between one and five years, while First Active offers both rates at an equal 8.5 per cent.
Bank of Ireland customers get one year's free membership of the Bank of Ireland Motor Assistance Service. Irish Life & Permanent offers a year's RAC membership while AIB currently offers a mobile phone, AA membership, GAP insurance and a car safety kit in its accelerator package.
First Active is offering a reduction of 0.5 per cent for new customers and up to £100 off motor tax, although this depends on the cost of the car.
As with most of the motor-loan schemes, First Active does not restrict its scheme to customers. The maximum payment period is usually five years but it is possible to negotiate with an individual branch to extend this to seven years if the price of the car is very high, according to one loan adviser.
One extremely popular financing option for companies and some individuals, is the vehicle lease loan available from AIB. The essential difference between this scheme and a motor-loan scheme is that the customer does not own the car until the final repayment is made. The second method is particularly popular with companies which can claim back the VAT. It also offers one of the most competitive rates of all in the motor loan sector - 7.83 per cent. The sums on a £10,000 vehicle lease loan paid over five years would consist of 60 payments of £195.82 payments.
It is clear from the different schemes on offer that increasingly customers are being offered more choice on how to tailor loans to suit their own circumstances. But it is important to shop around and do the sums.
