To pay so much for a car on finance?

[CaulkheadUpNorth]

I've been quoted for a finance deal which includes two years warranty, three years service and mot. It's a two year old car, with 21,000 miles.

The amount I've been quoted is high due to having defaulted on two accounts four years ago. It stays on credit report for six years.

The amount I've been quoted is nearly 20% of my post-tax income. If I take away all my rent/bills etc it would be a third of my disposable income.

Aibu to get the car? My job changed in May and I'm really struggling without a car. It's possible, but hard and disadvantages other people.

Don't assume older cars are not necessarily less reliable or more expensive to run. I drove a 15 year old corsa for years, it passed it's mot first time every time, barely cost a penny in maintenance.

a few years ago, we got a 10 year old car (at the time) for 600 quid. worked brilliantly. mind you, we didn't need it daily, so it only got weekend use.

You should think about it hard. you are going to be saddled with a lot of debt. My impression is that you can get a decent car for 1000. Think about your reasoning here. You are saying you can't afford a thousand pound car, so your solution is to buy a 9000 pound car. That doesn't make any sense. and as others have pointed out, the cost of the car is the tip of the iceberg. Repairs, insurance and tax are need to be accounted for.

Police in Glasgow were stopping people leaving cash and carrys and if they were buying for their shop or cafe and never had business insurance they got fined and points.

You do seem to be making a big effort to help people which is lovely, but you should not be taking on debt yourself for this.

As you say it is a small charity with no money for anything what would happen if they had to let you go and you are left with a debt you cant afford that you did not need....

I would suggest the Church buy a car for use for all the staff and they use it as a pool car - that way they cover business insurance also

You want something like this

www.autotrader.co.uk/classified/advert/201404053091808/

Reliable and cheap (and that one isn't the cheapest either). Citroen is shit.

Thank you for all the replies. I'm feeling that there are more options than I was aware of. Back to the drawing board :)

Just remember business insurance

That should be a expense that your employer should pay for

I've just bought my second 10 year old car, reluctantly had to scrap the old one which was a great runner but was starting to need too much welding each time.

new car was £1300, has been well maintained and no rust. I budget about £300 a year for fixes. Still a lot cheaper than finance!

look on the honest john forum for hints and ideas on the cars that interest you. This will tell you which years and models are to be avoided. As cars grow more and more 'tech' there is more to go wrong.

Another thing about older cars is that if you don't know much about them, I wouldn't go for an older automatic. If something with an auto engine goes wrong, it can cost just as much as the car to repair it. Whereas it's easier with a manual for some reason. Bitter experience!

We are buying a newer car next year admittedly, probably 4-7 years, but only because we need an automatic. I am a bit wary of older automatics and DP doesn't know much about the older ones so he's not confident in buying them! Even then our maximum budget is £4000.

I had to rush the last post but RE passengers. I ended up having many long conversations with my insurance brokers to ensure that I was allowed to carry passengers on my business insurance, and I have to check that they have it written in my policy specifically each year, because I carry children in my car for work. Just chucking on business cover may not cover you if you're carrying passengers.

You'll also want to claim mileage from your job if you have a car and will need to look into that.

Assuming you don't have to have a car, only buy what you can afford to pay cash for. The downside of finance is not just the cost in pounds, it's the difficult-to-quantify risk of committing yourself to outgoings you may not be able to keep up. You don't know for certain what your income will be in three years time, nor what your spending priorities will be, so don't rob your future self of choices to make life easier for your present self.

Even if you did have to have a car, you can buy one in perfect running order for under £1000. If it breaks down, buy another one if that costs less than the repair bill. Even if you're unlucky and the first one lasts less than a year, if you repeat the same process your luck should average out over time, and this approach will work out cheaper in the long run.

I hate it when people who have £1000+ to spare to pay for a car upfront get all snappy with people who have no choice but to get a car on finance.

I need a car. My very old one broke beyond repair.

We had £200 in the bank ie from overdraft limit

We couldn't afford an old banger outright.

We are now paying £145pcn car loan. This is a huge chunk of our income.

Only the rich have 'choices'.

Here's a thread on another forum that may give you some ideas

I travel about 20,000 miles a year and need to do so as economically as possible consistent with moderate reliability.

For the last several years I have bought cars off ebay for around £200 with at least 6 months MOT, then run them until they break or the MOT runs out; repeat as required. I don't spend any money* on them, other than petrol and tax. I do have an AA card, with Relay, which I have used 4 times in the last year, including one relay home, and I'm not too bothered about breaking down occasionally - just get the car to the scrappy and buy another (if I haven't already got one sitting on the drive).

Does anyone have a more economical option? Current average annual cost is £600 plus petrol and tax. Of course, depending on the car, petrol consumption may be better or worse. Worst was 31mpg, currently well over 45mpg on an N reg Toyota Primera.

forums.moneysavingexpert.com/showthread.php?t=861921

Bollocks, the OP has the choice not buy a French car which will depreciate like a stone for £7k.

That's the biggest problem here.

And spending £1000 upfront doesn't mean you are rich, when I bought my first car (for £1,000 in cash) I had about £5,000 in debt - but it was all on 0% credit cards.

And the other problem is in five years time the car you bought 'nearly new' might be falling apart, but you are still paying for it, so you can't get rid. So you are hit with the triple whammy of:

• paying for a car that's now worthless
• paying interest on the above
• big repair bills

weather That's very different to what OP is talking about though, she wants a car for convenience, you need a car.

Regarding the OP, if she has to go through finance, then what about cheaper cars on finance? Why a £7000 car? It's about becoming aware of choices, and also aware that "old car" doesn't mean "bad car", which a lot of people seem to think. Having seen both of my sisters crash cars on finance and/or lease and then have to continue paying for them when they've been written off, I can't understand why you would willingly put yourself into that situation when you don't actually need a car.

& it's not just the rich who can afford to buy a car up front The only reason we manage it is by saving when we can and trading in old cars. Even bangers have some value to the right seller.

weather
Define "get snappy"?
Folks are simply asking OP to think very seriously about how much debt they would be getting into, and providing plenty of solutions that prove that it isn't as simple as £7k loan or no car.
I think you are confusing the terms 'rich' and 'frugal'.

My neighbour bought a new Citroen C1 on finance, it has spent more time in the garage being fixed than it has outside their house.

A few years ago dh needed a car for work, we didn't have time to look around so we bought a Nissan micra for £300 in hope it would last a few months so we could look for something else, it lasted 4 years and went through every MOT ( until a few weeks ago when it failed ), he has now replaced it with another old car which cost him the grand total of £250, if it lasts a year then we have got more than our money's worth. A £7000 car would lose £1000 as soon as you have bought it so much cheaper to buy a older car and run it into the ground.

Would a second hand 7k car be worth 6k as a third hand car a day later?

Nope, it wouldn't as it was never wort £7000 in the first place ( unless you were the garage who was selling it ), chances are the garage payed around £5000 for it from auction or a private seller and are pocketing £2000 from the sale. Look on auto trader, gum tree and ebay at the same car and you will find it for a lot less from a private seller. If you were to buy the car, there would be no way you could sell it on the next day for the same price.

I have a brand new car on 0% finance. Costs me 10% of my monthly wage and is worth every single penny IMO. Five years warranty, services covered for next three years and no road tax.

If they hadn't done it on 0% I'd have looked at bank loans to compare it with.

But Wetheral the op will hsve choices if she just hangs fire for a few months and saves what she'd given to the car finance.

If they are offering an extended warranty check what it actually covers. These are generally more limited than the original warranties.

It's not just this thread. This has come up before on mn with the 'we aren't rich we're frugal' smug brigade looking down their noses at the working poor who can't imagine ever having a bean left at the end if the month to 'save' or access to 0% credit cards.

My last car was an old banger. The petrol was costing double what the new one does.

My mum recently bought a £1200 car from a used car salesman. One month later she discovered faults beyond repair.

That's getting ripped off!

I would have a look at fraidycat's post about buying very cheap old cars with mot and tax. Then sell a month before they run out. the trick is to buy the best spec old car. DH did this for a couple of years. It was very cheap motoring. You do need AA cover but I was amazed at how infrequently he called them.

DH used to buy cheap cars and for him it was very cheap motoring, it might sound a bit of a sweeping statement but being female i was a bit fearful of breaking down and all the noises they made which DH would just brush off and turn the music up. Also if they did break down he could always mackle it up at the roadside or if not, didn't mind waiting in the dark for the AA which I wouldn't want to do.

Just a few thoughts but it is usually men who buy old cars to see them through a few months, its not so bad in the summer but in the winter its nice to have fairly reliable car, but you don't have to pay £7k to get that.

I've had old cars till they break down before. One on the motorway and one on a busy roundabout. With the last, I lived in an area where it would take an hour for aa to come. In the end I stopped driving it as was too scared it would stop and at a time that would endanger myself/others and couldn't afford garage repairs.

Hence wanting a newer model with services/warrantee included!