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New car talk (finance) - worth it? - ginge191 - 11-11-2014
So i'm in a bit of a pickle over varying opinions and such so i'll chuck this out to the enthusiasts community and see what you guys say
I'm in a position to purchase a new car, brand spankers, 'rare' car, as in, only "100 for the UK market" rare.
Now speaking to my local dealership who have bent over backwards to source me the car and i've come up trumps; there are 2 left...
Now , my only issues is the finance; due to the nature of the car and probably the dealership as well, they don't offer a 0%; instead it's a 11-14% variable.
The monthly payments i'm looking at wouldn't put me out of pocket to the point i'm broke and would also mean i can still put into my mortgage pot.
I can put anywhere between a 0-40% deposit down; but realistically i'm looking at paying finance over 5 years; which they're happy with, as am I.... well... i am before speaking to you rowdy lot.
So, can anyone experienced speak wisely as to finance and options?
Please keep this sensible and on topic
RE: New car talk (finance) - worth it? - Dum-Dum - 11-11-2014
What are we talking for an overall price and how much effectively are you going to be borrowing.
If you have a good credit rating your bank will probably lend you the same amount of money at a lower rate of interest.
RE: New car talk (finance) - worth it? - Piggy - 11-11-2014
Yeah what DD said.
Check mileage limits too with finance via dealership
RE: New car talk (finance) - worth it? - ginge191 - 11-11-2014
(11-11-2014, 05:42 PM)Dum-Dum Wrote: What are we talking for an overall price and how much effectively are you going to be borrowing.
If you have a good credit rating your bank will probably lend you the same amount of money at a lower rate of interest.
After speaking to the bank; due to the fact my salary has been rolling for a few months now, they won't lend me the whole, or even near the final price.
The price of the car is £22, 145 with a final cost of £27,554 - that's with a £1k deposit.
The final price can be reduced slightly with a greater deposit, again, bank dependent.
The £1k i can scoop up no worries.. that's why the quote was based on the amount.
RE: New car talk (finance) - worth it? - 306Dan - 11-11-2014
All I can add after working in dealers for a while is put the largest amount possible down on the table first, and if you can pay a little extra off when and where you can afford that extra £50 aslong as the finance contract doesn't charge you for paying off early
RE: New car talk (finance) - worth it? - ginge191 - 11-11-2014
(11-11-2014, 05:51 PM)306Dan Wrote: aslong as the finance contract doesn't charge you for paying off early
Very useful; thanks; didn't even know they'd charge for paying off early - thought they would appreciate it!
RE: New car talk (finance) - worth it? - Dum-Dum - 11-11-2014
Ginge, First Direct will lend you £20k over 5 years at 4% (unsecured to a non homeowner with a good credit rating)
Total charge for finance is £2061.12 with monthly payments of £367.69
RE: New car talk (finance) - worth it? - ginge191 - 11-11-2014
That still leaves the remaining 7k?
RE: New car talk (finance) - worth it? - Connor - 11-11-2014
In a word, no. Speaking as someone who works for a main dealer and gets discount, it still isn't worth it. From what other people (who do have new cars) say, the best way to do it, is to put as little in as possible and have a cheap a car as possible, because at the end of it, you would have paid off alot more than the car is worth
RE: New car talk (finance) - worth it? - Dum-Dum - 11-11-2014
Ginge search for personal loans you should get it cheaper
RE: New car talk (finance) - worth it? - ginge191 - 11-11-2014
(11-11-2014, 06:08 PM)Connor Wrote: In a word, no. Speaking as someone who works for a main dealer and gets discount, it still isn't worth it. From what other people (who do have new cars) say, the best way to do it, is to put as little in as possible and have a cheap a car as possible, because at the end of it, you would have paid off alot more than the car is worth
I wouldn't ever buy a new car intending to keep the value of it, so that's not a concern as such.
What do you mean by 'put as little in as possible'?
(11-11-2014, 06:16 PM)Dum-Dum Wrote: Ginge search for personal loans you should get it cheaper
Also, retrieving a few quotes and the credit ratings required are a lot higher. I think using peugeot's finance deal would also put me in a good stead for future purchases?
RE: New car talk (finance) - worth it? - THE_Liam - 11-11-2014
Not sure if this is off-topic, but I wouldn't even think about putting big money into a depreciating asset while saving for a house deposit (which is what I assume you mean by mortgage pot).
RE: New car talk (finance) - worth it? - Ruan - 11-11-2014
IMHO - no.
I mean, have you actually worked that one out!!! You're paying 24.4% of the value of the car for the privilege of someone lending you 22k over a few years, that's f*cking insane!!!
There's no such thing as a good deal when it comes to finance... Bank loan is the most hassle-free, currently you can get a personal loan for very close to the same rate as mortgages, I've seen them as low as 3.5% - ones for larger sums rising to about 7.0% - which is bloody nuts! Banks are encouraging lending to boost the economy - but you've gotta be careful with them...
If it's the car I'm thinking of, in 5 years time it'll be worth as much as a toothbrush and no one will want it, and you'll barely have recovered from the costs of it - do you REALLY need a new car?
RE: New car talk (finance) - worth it? - Niall - 11-11-2014
(11-11-2014, 10:58 PM)Ruan Wrote: There's no such thing as a good deal when it comes to finance... Bank loan is the most hassle-free, currently you can get a personal loan for very close to the same rate as mortgages, I've seen them as low as 3.5% - ones for larger sums rising to about 7.0% - which is bloody nuts! Banks are encouraging lending to boost the economy - but you've gotta be careful with them...
This. Ive been offered 25k by Lloyds and thats along side my current loan!.....Just a shame I've f*cked my credit rating for a few months due to insurance quotes with direct line group
RE: New car talk (finance) - worth it? - procta - 11-11-2014
Ginge Id take out a personal loan, that way you have a bit extra to put towards the car, Plus you wont be paying more than the car is worth in the end. I took out personal loans for my two 306s,
RE: New car talk (finance) - worth it? - 306carter - 12-11-2014
Insane. If you can 'Afford' to pay the deposit and monthly repayments. Why not just save for a car? Sorry for being the killjoy but I see no benefit in car finance what so ever. IMO of course.
RE: New car talk (finance) - worth it? - Poodle - 12-11-2014
The most expensive way to be on the road, without exception, is to buy a new car on finance. Tbh i don't understand how that ever becomes an option, unless you've got money to burn and need expenses to fob off the tax man.
Re: RE: New car talk (finance) - worth it? - THE_Liam - 12-11-2014
(12-11-2014, 06:52 AM)Poodle Wrote: The most expensive way to be on the road, without exception, is to buy a new car on finance. Tbh i don't understand how that ever becomes an option, unless you've got money to burn and need expenses to fob off the tax man.This, to be fair. I always end up having a rant about it but to me, unless you've got money to burn it is mad. The amount of people I work with who live with their parents, pay £400 a month on finance and then complain that they can't afford to buy a house is ridiculous. Surely a house is a bigger priority?
RE: New car talk (finance) - worth it? - ginge191 - 12-11-2014
The way I see it; is that my overheads aren't huge; yes I could put that money into property, but once into buying a house, I won't have the opportunity to buy a new car, ever.
As for the value of the car Ruan, it wouldn't be something I'd want as an economic investment. But, I'd hold onto for , moreorless, forever.
Hmm split down the middle!
RE: New car talk (finance) - worth it? - Matt-Rallye - 12-11-2014
My input:
This is something i have been looking at alot recently, albeit not a BRAND SPANKERS car but rather more a cheaper / older car with a 25% deposit and the rest paid off over 3 years.
My reasoning for this is that i have never borrowed money in my life which although morally correct, doesnt stand me in a good credit rating for in a few years when i want to buy a house and obtain a mortgage.
IMHO i would say if you can realisticallly afford it and afford to repair / maintain said new car then go for it! and please tell me its a 208 gti 30th edition
Best way to do it is to put as much down as possible before hand, what contribution is the dealer putting in? as most offer a £500 dealer contribution on a new car.
RE: New car talk (finance) - worth it? - Toms306 - 12-11-2014
(12-11-2014, 07:33 AM)ginge191 Wrote: As for the value of the car Ruan, it wouldn't be something I'd want as an economic investment. But, I'd hold onto for , moreorless, forever.
Modern cars aren't built to last forever, just to outlast the warranty period lol.
You also lose more by keeping a car until it dies than selling it at the right time, but that's not really for this thread.
I can see the reasons for doing it, I know people that have done it, but it's not for me. Maybe it is for you though...only you can decide that, have you tried asking on a forum for that particular car? I know on VAG forums and the Ford forum a lot of people buy cars on finance!
RE: New car talk (finance) - worth it? - w3526602 - 12-11-2014
Hi,
You go out to work to earn money for you to enjoy. Spend it wisely or indulge in riotous living, your choice, just enjoy it.
You borrow money, so have to pay interest. You don't enjoy the fruits of your labour, your bank manager does.
Whether you consider that a good swap, only you can decide.
But ask yourself what would happen if you lost your licence, lost your job, were disabled so unable to drive, petrol was rationed, etc? Presumably you are married, so how would SWMBO manage if you died? How would you manage with another mouth to feed?
It's still your decision.
So, have you checked out the cost of insurance? Or the increased cost of insurance if somebody hits you? Add 15% for five years, even if you keep your NCB.
Have you checked the cost of routine servicing, which you would not do yourself on a new car? This year, my wife paid 20p per mile for servicing, but that was because she did only 6000 miles (car is now two years old, she has done just a smidgen over 10,000 miles altogether).
It's still your decision.
The cheapest way I have found to borrow money is with an OFF-SET mortgage linked to savings OFF-SET savings, all with the same bank. Everything you borrow is at mortgage rates, and every penny in your cheque or savings account is off-set against the mortgage interest, cutting down the interest. Credit cards are settled in full (would that save you anything) and settled in full every month thereafter. But you have to be disciplined ... buying a new BMW is just too easy. Ask your bank, if they say no, ask First Direct.
Due to a family cricis, we needed to move house ... before selling our old one. SWMBO had squirreled away a silly amount, which could be used as a deposit. So take out a mortgage, pay it off when we sell the old house. WRONG! As soon as I mentioned my age, 75, they refused to discuss lending us anything. No ifs, no buts, NO![/i] Prudent Lending[i], they called it. I battled on for two years, eventually found somebody to give me a mortgage ... INTEREST ONLY @ 4%..
602
If you intend to buy a house, do it ASAP before prices rise ... its maybe too late. See what sort of deal a major house builder can get you, before prices go up in new year. You should get 20% at interest free for five years, which should give you time to pay for your new car. Builders and lenders rub each other's backs. But a garage may be difficult.
Good luck, whatever you decide
RE: New car talk (finance) - worth it? - Dum-Dum - 12-11-2014
(12-11-2014, 07:33 AM)ginge191 Wrote: The way I see it; is that my overheads aren't huge; yes I could put that money into property, but once into buying a house, I won't have the opportunity to buy a new car, ever.
As for the value of the car Ruan, it wouldn't be something I'd want as an economic investment. But, I'd hold onto for , moreorless, forever.
Hmm split down the middle!
Your wrong there mate.
In the 18 months I've lived here my house has gone up in value by £25k and I need to remortgage at the end of the 2 years to switch to a new best deal. I could effectively take that profit out and buy a brand new car as cash (and still have it depreciate massively)
Now is the time to get on the housing ladder mate, the rate that prices are going up is phenomenal, its at the stage where the prices are going up faster than what the monthly mortgage payment would cost.
RE: New car talk (finance) - worth it? - r3k1355 - 12-11-2014
Has the car been mentioned yet??
It's just you seem hell bent on getting this mega limited edition, only 2 in the country car - and you're willing to pay over the odds for it.
So what is it??
RE: New car talk (finance) - worth it? - silverzx - 12-11-2014
Mark 5 Toyota Supra? 6L tri-turbo?
RE: New car talk (finance) - worth it? - Niall - 12-11-2014
Tbh Ginge I know the car you are thinking of buying and whilst it's quite special, I wouldn't bother. I would never ever buy a brand new car unless I had so much money that I could bin the car and not be worried about loosing that investment. Id be looking at cars that are a few years old and have already depreciated a lot.
To give you an idea, my old Octavia was 17k brand new, 3 years on it went to auction for 6k. I'd take a 3 year old car over new for that sort of price difference! Then if you were worried about work on the car, you could take out an extended manufacturers warranty. They really aren't that expensive.
Re: RE: New car talk (finance) - worth it? - THE_Liam - 12-11-2014
(12-11-2014, 11:07 AM)Dum-Dum Wrote:When I bought my place 3 years ago it was worth 100k. Since spent 10k on it but with the improvements and appreciation its now worth 145k.(12-11-2014, 07:33 AM)ginge191 Wrote: The way I see it; is that my overheads aren't huge; yes I could put that money into property, but once into buying a house, I won't have the opportunity to buy a new car, ever.
As for the value of the car Ruan, it wouldn't be something I'd want as an economic investment. But, I'd hold onto for , moreorless, forever.
Hmm split down the middle!
Your wrong there mate.
In the 18 months I've lived here my house has gone up in value by £25k and I need to remortgage at the end of the 2 years to switch to a new best deal. I could effectively take that profit out and buy a brand new car as cash (and still have it depreciate massively)
Now is the time to get on the housing ladder mate, the rate that prices are going up is phenomenal, its at the stage where the prices are going up faster than what the monthly mortgage payment would cost.
RE: New car talk (finance) - worth it? - RetroPug - 12-11-2014
If you can't afford it, buying it is a bad idea from a financial point of view.
That's very simplistic, but also true. If you want to proceed knowing that it is a terrible decision financially, but you really want it, then that's your decision.
RE: New car talk (finance) - worth it? - Eeyore - 12-11-2014
i just wouldnt bother unless it was something i really wanted... i would definitely get a personal loan over finance.
RE: New car talk (finance) - worth it? - Anton - 12-11-2014
Being in the position to buy new I still didn't. I bought a 3 year old car for 11k on finance, it was 26.5k new. Volvos own finance was better than I could get a personal loan for, 5.5%. Total payable 13ishK over 4 years with no early repayment charges.