Looking for a car loan - advice please

valkia

valkia

valkia

Soldato
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I've come to decision for a new car which i'll be getting a loan to fund.

I've been looking around but want to hear from the forums which would be a decent and reliable way about the loan as it will realistically be the first one i'll be taking out.
I'm looking for £5k over period of 2.5 - 3 years, maybe even longer if I can pay off early without fees.

Please advise :)
 
Sainsburys is probably the cheapest at the moment, but you have to be a nectar card holder to qualify for the rate.

Tesco probably the best bet after that.

Who do you bank with? Need to consider your credit history too -- Some lenders might be wary if you have no history and you are not an existing customer. Your bank will obviously have a history for you, so you stand a better chance of acceptance, but may pay more for it depending on who you bank with.
 
Banking with Barclays, however APR seem's to be sky high with them, will take a look at Sainsburys however i'm not currently a nectar card holder - Will enquire about that too
 
Its probably not a good idea to take out a £5k loan for a £5k car. Reasons:

a) A £5k car from a dealer isn't a car you can sell for £5k, effectivley therefore once you've bought it you owe more on your loan the cars value, putting you in negative equity

b) £5k cars are often not perfect. It might have a few niggles that need attending to but are not apparent until after you've bough it. If you have spent all your available funds on the car then this can be difficult to do.

Its probably best to wait until you've got a grand or so saved up and then borrow money to buy a car.
 
PX is almost likely to take place too, but the car wouldn't be worth more than £900 - £1000 to a dealer. The reason 5K would be is because the APR was lower to take out that sum instead of just 2 - 3k.

Car for PX is Focus 03 1.4CL

Car to purchase CTR EP3 04/05

Of course i'll be taking a look at a few and going through the options, but it's time that I got something else and really enjoyed driving RJK's CTR and took a fancy to it.
 
Is it a good idea to buy a performance car if you don't have a bit of cash behind you to run it etc?

I'd be strongly tempted to wait a few months, get saving, and then take the plunge once I had a wedge of cash tucked away.

I'm sure the usual crowd will be along soon to moan about talking about finances but finances are a big part of car ownership and this is a financing thread so I guess its allowed :p
 
Have you considered selling the focus privately then buying the ctr privately too? If you pick a car for sale on one of the forums its pretty easy to look at a bit of the history as people tend to write about their problems. Generally they're better than a random autotrader car.

If you had even 1500 to out down on a 5k car you'd be a lot more able to get rid if anything went wrong. The apr may be higher but it would have to be massive to compensate for another 1500 on the loan
 
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Well i'll have a bit of cash behind me, just as I said the APR was much better on a larger loan of which needed I could pay back the amount which wasn't needed. I'm only about 10 mins from work so if said problems were to happen I can always walk/cycle (hopefully not) but i'll also have cash to fix problems if any did occur.

I have CTR veteran RJK coming to look at them with me as he's recently bought his one and so every known fault can be looked at and tested by him (and me to what I know.)

However I may just save up some more before hand, as I've never had a loan before I thought it could also do good for a credit rating.
 
By something going wrong I mean job loss, crisis that requires freeing up of cash etc. If you suddenly find yourself in a position where you cant afford the money leaving your account every month how do you plan to repay the loan including repayment fees when you've bought a car from a trader who will have sold at retail but you'll only get trade price as a quick sale?

Food for thought more than anything you'll be able to assess the financials yourself
 
valkia said:
I have CTR veteran RJK coming to look at them with me as he's recently bought his one and so every known fault can be looked at and tested by him (and me to what I know.)
Click to expand...

Doesn't stop a fault developing when you own it. Give yourself some headroom, you're buying a 7 year old car which without doubt will probably want some money spending on it somewhere down the line.
 
Fuzz said:
Depending on your credit history / yearly income, might you get a 0% interest credit card over say 15 months. Money saving expert was recently saying that it was the cheapest way to borrow amounts around and under 5K

http://www.moneysavingexpert.com/cards/best-0-credit-cards
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You'd need an exceptional credit rating and a healthy income to get a £5k limit on a 0% card. Something most 22 year olds won't be able to do.

That and the fact that almost all car dealers wont take the full balance on a credit card because of the merchant fees, which soon add up on a purchase of this size. Then he's gotta hope he can balance transfer it in 15 months time, which will mean in theory needing double the credit at that point to do the move.

Basically, its a **** idea :p
 
I took out a 7k loan a few years ago, at around 5% APR for a car, spread over 5 years,
to be honest i regretted it somewhat, as anything over a couple of years starts to feel a very long time

Personally i would save up some and take out a 2 year loan max and leave some money for extra expenses, you never know what might let go after you buy it, i know the feeling of impatiance of wanthing something now and it can be hard to resist that urge, but it's never a bad thing if you can at worst you end up waiting that bit longer and at best you may decide you want something else entirely
 
I was playing with the Santander loan slider thing the other day and the APR (if that's the right term, I've never understood it) drops once you borrow 7.5k. Could possibly just pay the 2-3k straight back?

Being a complete ***** though, I would recommend you sell your Focus privately then pick up an early CTR for pennies with no loan. Maybe! :p
 
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