Although a generic personal loan can be used to purchase a car, it is worth considering specialist car finance packages.

These loans are offered by banks, brokers and car dealers. Both secured and unsecured options are available, although it can be difficult to obtain an unsecured loan for sums greater than £15,000.

As always, make sure you shop around by comparing the APR of different options. Don't just accept the package offered by your car dealer, as it may not be the most competitive.

Many dealers will also offer you the option to lease a car, or to take out a hire purchase plan, which is essentially just another type of loan. If you opt for either of these, bear in mind that the actual ownership of the car remains with the dealer until the car is paid for in full.