Is 10.9% APR ok for used car finance?

[Soymocha]

First time getting used car finance. The reason is that it's worth it because of the services and extended warranty thrown in. We can repay the loan amount in full after a few months. Financially, it is worth it.

However, is 10.9% APR too high? I noticed that they missed a digit off my salary so it's possible this affected the credit check and resulting APR offered. On one hand, if we re-ran it, even getting it down to 8% APR would only save around £40 over the entire repayment period (since I plan to pay off early). But re-running a search may impact my credit score. I'm wondering if it's worth it. Or possibly 10.9% APR is to be expected now in today's economic climate even if my credit score is good? I've always had good credit so I assume I have a good score.

I'm also told APR is always higher for used cars but I'm not sure why.

Any advice would be much appreciated as I'm new to this. Thanks.

If you're sure you can pay it off quickly it doesn't matter that much, but its expensive compared with a personal loan.

Just check that the extras are worth the effective cost and theres no nasty penalties for early repayment.

It’s not terrible for the current climate.

Have you costed up if the warranties etc are worth it, vs a bank loan? We borrow some money for a car this year and the bank loan rate was half what the car garage was offering us.

It’s not too bad. Lots of places are 12.9 or even up to 14 at the moment for used.
used rates are higher as the manufacturer subsidises rates for new purchases.

Thanks. Yes, we've costed it up. If we repay early, the interest should only be around £150 tops but we get an additional years warranty plus two services thrown in with the dealership. We don't need the loan but the dealership suggested we do this to take advantage of the offer.

Check with the finance agreement that you can clear it off early, as some of them have a clause that charge you more interest if you do this....and the reason the garage advised you getting finance is that they will get commission on the finance from the finance company.

Used to work in car dealership and the sales guys always loved a car finance agreement as opposed to a cash sale.

@ToWonderWhyIBother thanks. This is exactly what we asked today and there is no early repayment charge provided we pay at least 3 months. I suppose it's a win win. We get the services included which saves us money and he gets a commission.

Seems okay on the face of it, but double check the T & C, check that by paying it off early, you're still entitled to free servicing and, extended warranties are quite often meaningless, with endless get out clauses. If you go through T & Cs with a fine tooth-combe, and it all seems above board then go for it.