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buying a new car
Former Member
Posts: 1,876,323 The Mix Honorary Guru
Im buying a new car but im not yet sure how. There's deals all over the place that are confusing me, ideally i'd get it on 0% finance but i cant find that on the car i want (vw polo diesel hatchback) im not actually sure how much this car would cost as the WV website doesnt seem to want to tell me, probably around 10k.
I already have 7k saved up for it so i dont need to borrow much, I expect my current car to be worth a maximum of 1k. So i could potentially have 8k to hand over now including part exchange. So i'll need to borrow about 2k in the cheapest way possible.
Would it be best to get a small loan from a bank? if i did this could i pay it off as quickly as i please? or would it work out cheaper to do it with finance? With finance would i be allowed to pay off a lump sum? Or would i be better going off to one of those car supermarkets? I can pay back at least £400 per month and would rather pay off the maximum i can afford than be paying back more in the long run with low payments.
Any help appreciated!
I already have 7k saved up for it so i dont need to borrow much, I expect my current car to be worth a maximum of 1k. So i could potentially have 8k to hand over now including part exchange. So i'll need to borrow about 2k in the cheapest way possible.
Would it be best to get a small loan from a bank? if i did this could i pay it off as quickly as i please? or would it work out cheaper to do it with finance? With finance would i be allowed to pay off a lump sum? Or would i be better going off to one of those car supermarkets? I can pay back at least £400 per month and would rather pay off the maximum i can afford than be paying back more in the long run with low payments.
Any help appreciated!
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Comments
If you need money for a car then get a loan from the bank or another source. Finance companies absolutely hammer you on interest e.t.c.
Saying that, £7k is a lot of money. have you not considered perhaps getting a slightly older, but ultimately better car?
I had 8K to spend in 2006 and bought a 54 plate 1.8 Focus Edge with A/C and alloys and it only had 18,000 miles on the clock. Much better than anything I could have bought that was newer.
I'd prefer to get a new car really so that i can trade it in every 2 years while its still worth loads. Saying that, i could easily do that with a year old car that would cost significantly less.
Definately something to consider.
I suppose i could even apply for a credit card that has a years free interest on purchases, buy the car, pay off my 7k instantly, sell my car and pay off what that's worth then pay off the rest in under a year. That way i wont be paying any extra? Or is that just what my bank leads me to believe? I've not had a credit card before
You could get a quality second hand Golf TDi mark iv for the money your talking about. Much better idea.
You'll lose more money by buying a brand new car. Cars depreciate the most in the first 12 months of buying them and then theres the fact you have to drive like an old bid everywhere for the first 1000 miles to run it in.
http://www.moneysavingexpert.com/cards/lowest-interest-credit-cards#deals
So if you need £2 grand, put what you can up to the credit limit on the card... then make the repayments on the card - but remember after a certain amount of time the 0% deal will end and you'll end up paying interest. So if you don't think you can pay it off within however long it is it might not be a good idea.
I got a 0% card for some big purchases I had to make - although I know I'll have the money in a year to clear the debt on the card before I start paying interest.... which makes it a free way of borrowing, but you've got to be careful.
As others have said avoid getting finance, unless it's a 0% deal or something with the dealer.
Second hand, £7500 will get you a 55 plate polo with 10k on the clock and a 1.4 engine, or a 54 plate golf, with 20k, 1.9 engine and alloys.
I know which i'd prefer.
Financially that is (almost) the worst possible way to manage your car ownership. You'll lose masses of money each time due to the "new car" depreciation factor.
Still, if you can afford a new car every couple of years, what might be worth considering is one of the dealers offers where you effectively lease the car for a period of time, with an optional final payment or hand the car back. If you know you are going to be getting a new one you can just start over. It may work out better for you than taking the loss on a new car.
- though there is nothing quite like the feeling of buying your first new car
for the £2k :yes: you'd be better with a bank loan. but make sure you look around for the best interest rates.
So if i was to get a credit card with 0% interest on purchases in the first year, and i use £2000 from it, pay that back in no more than 4 months, there's no way i'll be paying any extra, is there?
Already found loads of polo's on autotrader that are far better than a basic new one.
Thanks for the advice everyone