Car conundrum - what would you do

PopkinsBear · 2025-03-03T20:53:04+00:00

Thoughts welcome please - can’t agree on way forward with DP yet: We have one car on a PCP which ends in the summer. -Balloon payment is c.11k or we could simply give it back. -Car is a hatchback and we now have a DD (nearly 1) and find that we need something slightly bigger (or at least will in a year or two) -We can afford to pay the balloon but as mentioned above, we will need to change it in next two years. -I think we should use extra savings/expected work bonus on buying outright a used car for £15-20k and hand back our current one. -DP thinks that’s a lot of money and we should put down a c.7-10k deposit to finance a car for 3/4 years but this will come with a c.£200 monthly payment, albeit we will retain more savings and probably get a more recent car. What do you guys value - I think one less outgoing can only be a good thing when we have a Mortgage rate set to increase in September and some childcare costs when I’m back to work.

SleepingisanArt · 03/03/2025 21:37

Why do you need a bigger car? I had a VW Lupo for me plus 2 children and our 'big' car was a VW Golf which DH used for work and if we were going on longer journeys. Plenty of space in mine for day to day, primary/ junior school runs and shopping etc. I moved to a Polo at senior school stage.....

ExIssues · 03/03/2025 21:39

Use 7 k to buy a car outright. Put 2k in a savings account. Spend 2k on a nice holiday. That's what I would do.

scorpiogirly · 03/03/2025 21:39

You could get a decent car for well under 15k.

Londonrach1 · 03/03/2025 21:53

Just buy a car outright. Why you need a bigger car. The best car I've had was a skoda fabia...so easy to park and drive.

Original poster

PopkinsBear · 03/03/2025 21:59

We don’t ‘need’ a bigger one as such but we are already struggling with space for luggage for trips away etc. Current car is a BMW 1 series.

OP posts:

Millyjanice · 03/03/2025 22:01

I had a used Nissan Note when my kids were toddlers to late teens. Bought outright. No monthly payments and were able to make bigger mortgage payments instead.And nice holidays.

Do you actually need a bigger car ?

I’d give that one back. Get something used for about 6k and invest the rest. You’ll really notice not having that extra direct debit every month.

Catza · 03/03/2025 22:01

Getting car on finance is a never-ending commitment. So I would avoid this option at all costs. It's better to buy a car outright or you will be faced with the same dilemma 3 years later. You can get a car for well under 15k.
Or, do what we did - pay 11k, sell the car immediately after. Not sure how well your car kept its value but ours did and we covered balloon payment plus at least two years worth of PCP payments. We then bought an old VW caddy for 3k which has been a real workhorse for us - large to fit everything/one but the kitchen sink and as reliable as a tank. Albeit not glamorous.

EdithStourton · 03/03/2025 22:02

Buy a car outright.
It's what we've always done and we've saved an absolute fortune.

Original poster

PopkinsBear · 03/03/2025 22:03

Just on the budget point - that’s ideally looking for a car that’s no older than 2020 - just want to limit the risk of stuff going wrong down the line.

BMW X1 is one i am looking into. I could get an older one for less but then it will come with greater risk..

OP posts:

OneRealOchreHiker · 03/03/2025 22:22

Look for the used cars from the dealers that give a good extended warranty. Got 2 years on my VW, which was handy when gear box developed a problem 22 months in…

RosesAndHellebores · 03/03/2025 22:27

£11k on a used, larger car. Look at less expensive makes.

JaceLancs · 03/03/2025 22:30

Buy outright and put what you would have paid on PCP into savings

XioXio · 03/03/2025 22:30

I'm looking for a newer, bigger car. My car is really small and 10 years old. I'm surprised by how expensive the cars are now. 15k for a low to mid range, not expensive brand, 5 years old and low mileage.

I wouldn't want to be tied to a car finance payment each month. Buy a car outright, the youngest lowest milage car you can

parietal · 03/03/2025 22:33

buy a cheaper car outright.

look carefully at the amount of passenger space / boot space you get in a bigger car. my bro has a SUV that is massive on the road, we have a VW golf - we fit 2 teenagers & 2 parents & all suitcases in the VW and he can barely fit stuff in the SUV. it looks big but lots of that is padding and height, but the actual amount of boot space is limited.

Millyjanice · 03/03/2025 22:41

PopkinsBear · 03/03/2025 22:03

Just on the budget point - that’s ideally looking for a car that’s no older than 2020 - just want to limit the risk of stuff going wrong down the line.

BMW X1 is one i am looking into. I could get an older one for less but then it will come with greater risk..

Less to go wrong on older cars and cheaper to fix.
Electrics on newer cars can be an expensive nightmare. Even changing the battery can be a needless complication.

BlueMum16 · 03/03/2025 22:45

PopkinsBear · 03/03/2025 22:03

Just on the budget point - that’s ideally looking for a car that’s no older than 2020 - just want to limit the risk of stuff going wrong down the line.

BMW X1 is one i am looking into. I could get an older one for less but then it will come with greater risk..

If you make the balloon payment how much is the car worth to sell yourselves as part ex? Second hand cars have gone through the roof. You might find the car is worth several thousand more than the payment.

AnxiouslyAwaitingSpring · 03/03/2025 22:51

Personally I'm a big fan of leases but that could be more to do with the fact that I could never afford to buy a vehicle outright or a proper deposit.
My lease includes servicing, insurance, tax (as I'm exempt from vehicle tax but would include it if I wasn't), breakdown, tyres & windscreen. £275 per month and brand new vehicle every 3 years with 100s to choose from. Never have to worry about anything else besides fuel. Never need to get an MOT. It's fabulous

Original poster

PopkinsBear · 04/03/2025 09:56

BlueMum16 · 03/03/2025 22:45

If you make the balloon payment how much is the car worth to sell yourselves as part ex? Second hand cars have gone through the roof. You might find the car is worth several thousand more than the payment.

Show quote history

We’d make about 1k maximum

OP posts:

ThejoyofNC · 04/03/2025 09:59

Just buy a car you can afford. Why would you choose to go into unnecessary debt?

Catza · 04/03/2025 10:09

AnxiouslyAwaitingSpring · 03/03/2025 22:51

Personally I'm a big fan of leases but that could be more to do with the fact that I could never afford to buy a vehicle outright or a proper deposit.
My lease includes servicing, insurance, tax (as I'm exempt from vehicle tax but would include it if I wasn't), breakdown, tyres & windscreen. £275 per month and brand new vehicle every 3 years with 100s to choose from. Never have to worry about anything else besides fuel. Never need to get an MOT. It's fabulous

Ever wondered why you cannot afford a "proper car deposit" though? You are literally throwing away the best part of 10k every three years of your lease.
My car was 3,5k bought for cash, over the last three years I've had it, I spent under 3k for MOT, tax, insurance, service and a couple of minor repairs (new battery, bushes, and tires). And I still have a car at the end of it. That's 7k+ difference every three years which over the course of 10 years amounts to 23k in a savings account (or a car deposit, if you'd like).

timeforachange999 · 04/03/2025 10:13

There is a misconception that it is better to buy a newer car on finance as then you don't need to pay for servicing/MOT / repair costs. However, you are actually paying for all those things in the lease/depreciation costs. So it is (nearly) always going to cost you less money over the lifetime of the car to buy a second hand car outright

Kindafreakingouthere · 04/03/2025 10:43

I think this is difficult...cars are really one big gamble these days. I think it also depends where you get your cars fixed when they have problems. Do you know any good mechanics that will help you maintain a used car? My OH is a workshop manager/mechanic so has literally all the contacts to get things fixed at the cheapest possible price or fixes it himself and also services my car more often than required...but my automatic gearbox has just gone and this is approx £2.5k to fix. Car has only done 56000 miles and the gearbox has been serviced so did everything we could to prevent...just really bad luck.
I think if you have little to no knowledge about fixing cars and don't have contacts to get them fixed up/money to put away for repair bills...often the lease/PCP deals are the best way to go nowadays. Generally once cars get to 5/6 years old, they start having problems. Things that used to cost £200-300 to fix are now £800-£1000.
But then you're paying a lot of interest to the finance company for that newer car/decreased risk of expensive repair bills.
Cars are just one big money pit!

Original poster

PopkinsBear · 04/03/2025 10:46

Kindafreakingouthere · 04/03/2025 10:43

I think this is difficult...cars are really one big gamble these days. I think it also depends where you get your cars fixed when they have problems. Do you know any good mechanics that will help you maintain a used car? My OH is a workshop manager/mechanic so has literally all the contacts to get things fixed at the cheapest possible price or fixes it himself and also services my car more often than required...but my automatic gearbox has just gone and this is approx £2.5k to fix. Car has only done 56000 miles and the gearbox has been serviced so did everything we could to prevent...just really bad luck.
I think if you have little to no knowledge about fixing cars and don't have contacts to get them fixed up/money to put away for repair bills...often the lease/PCP deals are the best way to go nowadays. Generally once cars get to 5/6 years old, they start having problems. Things that used to cost £200-300 to fix are now £800-£1000.
But then you're paying a lot of interest to the finance company for that newer car/decreased risk of expensive repair bills.
Cars are just one big money pit!

Yeah , it’s hard knowing what’s right to do!

One less monthly payment is what’s tempting me though..

OP posts:

yikesanotherbooboo · 04/03/2025 10:48

We have bought 'nearly new' and done a lot of shopping around for almost all our cars. We used a roof box for long journeys with a lot of luggage.

Kindafreakingouthere · 04/03/2025 10:49

If you're not too set on an exact car...I'd recommend going for something like a Toyota if buying used...they're the most reliable as far as I know so you'd be lessening that risk of the large repair bill. Pretty sure they have 10 years warranty which tells you all you need to know!
Unfortunately I'm an Audi wanker and I just can't see past them now 😂but paying for it!