Buying a car - HP, credit card, bank loan?

[Bakingcreampie]

I'm looking at buying a new car and will be part exchanging my current vehicle which will cover about half of the purchase price.

What is the best way (except paying outright which isn't an option) to finance the rest of the purchase price?

Any tips, advice or your own experiences appreciated!

Depends on your mileage and what you're going to use the car for.

PCP (personal contract purchase) deals are really only suitable for retired people, who drive less than 5000 miles a year and keep the car in perfect condition, as you are just renting it and will be charged for any damage when your contract ends.

Dealer finance will ALWAYS be more expensive than your bank (assuming you have ok credit).

Best way is to finance through your own bank, cheaper interest, and you own outright, if you needed to, you could at least sell the car. But a brand new car really isn't valur for money, you literally throw away 10% of what you paid by driving it off the forecourt. I would buy a low mileage, one year old example of the car you want. It will still be in warranty, have been run in, most niggling re-calls will probably have already been done, and the original owner would have taken the hit for the depreciation.

Of the three you mention, for me it would be bank loan all the way. Shop around for the lowest interest rate.

Have a look at leasing .. dealers aren't really doing pcp anymore because you aren't getting the equity at the end of the payment plan so may as well lease .. loads of great offers on and you can haggle . Have a look at car wow .

PCP (personal contract purchase) deals
are really only suitable for retired people,
who drive less than 5000 miles a year

Nonsense.

PCP doesn’t suit everyone though. If having a new car every x years is important to you, it’s worth an option, but it’s usually more expensive when worked out over an average year, than buying a car and keeping it until it’s no longer economical.

Are you buying a brand new car? Look for ex demonstrator models. They’re usually less than a year old and with a very low mileage (4 figures). Plus they are often top spec. The price is a lot less compared to a brand new model.

How much are you wanting to finance on your car? If you decide PCP isn’t for you then I’d say most likely a bank loan, if you have decent enough credit to get a good rate. The dealership rates will be pretty rotten.

Depends how much you’re talking. We’ve always had to borrow maybe £5k, so have put it on a credit card as a cash transfer with 0% interest rate and paid off as much as we can each month (always more than the minimum payment) and transferred the balance to another 0% deal at the end of the term. We prefer this as we can pay off a lump sum as and when we are able ie work bonus etc.

I would look for 1-3year old car as would never buy brand new. What a waste!

I would get a bank loan but only if I couldn't get an 0% card or cards to cover the purchase.