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  • FIRST POST
    Beardy
    Best Way To Borrow £5000 Over 5 Years.......
    • #1
    • 20th Nov 08, 10:44 PM
    Best Way To Borrow £5000 Over 5 Years....... 20th Nov 08 at 10:44 PM
    I am after some advice, i have never had credit cards in the past so do not really know what things mean or what to look for.
    In the past i have always gone with the bank but looking for a better option.

    I am looking to borrow £5000 over 5 years

    What would be the best way of doing this?
    Credit card or Loan?

    I have been offered a deal threw Black Horse Finance which is the following -
    £5000 (well £4795 as i am paying a Deposit) over 5 years they say its on 9%
    £122pcm x 60 months = total repayment £7320

    Now i am 100% sure there will be a better deal out there for me its just knowing which to go for.

    I have good credit history etc

    I know this is the place to get free advice which isent trying to sell me a product

    Thanks in advance

Page 1
    • CLAPTON
    • By CLAPTON 20th Nov 08, 11:20 PM
    • 38,135 Posts
    • 26,846 Thanks
    CLAPTON
    • #2
    • 20th Nov 08, 11:20 PM
    • #2
    • 20th Nov 08, 11:20 PM
    4795 over 60 months at 122 per month is about 20% APR (presumably you have bought a car... they just love to quote the 'flat' insurance rate )

    so if you have a good credit rating then get a much cheaper deal or even better, reconsider the purchase and save up instead.
  • Beardy
    • #3
    • 20th Nov 08, 11:36 PM
    • #3
    • 20th Nov 08, 11:36 PM
    I am looking at buying a Motorbike and the prices are really good at the moment.
    So what would anyone say to go for then?
    If you saying its 20% APR (sorry i have no idea how this is worked out) then ANY credit card would be a better deal?
    Like the CitiBank Card which says 5.9% APR when Borrow £5,000 over
    6 years

    ???
    • CLAPTON
    • By CLAPTON 20th Nov 08, 11:51 PM
    • 38,135 Posts
    • 26,846 Thanks
    CLAPTON
    • #4
    • 20th Nov 08, 11:51 PM
    • #4
    • 20th Nov 08, 11:51 PM
    Prices will be much much better in 6 months time... buy something for 500-1000 now and save up for later
  • moneysavingallday
    • #5
    • 21st Nov 08, 1:01 AM
    • #5
    • 21st Nov 08, 1:01 AM
    I am looking at buying a Motorbike and the prices are really good at the moment.
    So what would anyone say to go for then?
    If you saying its 20% APR (sorry i have no idea how this is worked out) then ANY credit card would be a better deal?
    Like the CitiBank Card which says 5.9% APR when Borrow £5,000 over
    6 years

    ???
    Originally posted by Beardy
    If you've never had credit cards, what makes you think you'll miraculously be offered one with a £5,000 limit now?
  • Beardy
    • #6
    • 21st Nov 08, 8:39 AM
    • #6
    • 21st Nov 08, 8:39 AM
    If you've never had credit cards, what makes you think you'll miraculously be offered one with a £5,000 limit now?
    Originally posted by moneysavingallday

    No idea mate
    Like i said i have never had a credit card so do not know how it works i thought you could ask for your limit?
    If you can only get a small ammount how do people get in debt by thousands with cards?
    So if i can not get 5k on a card right off then i need to look into loans?

    Any other advice?
    I am 28 been working for 12 years good credit etc

    • Any
    • By Any 21st Nov 08, 8:55 AM
    • 7,472 Posts
    • 7,800 Thanks
    Any
    • #7
    • 21st Nov 08, 8:55 AM
    • #7
    • 21st Nov 08, 8:55 AM
    Hi Beardy,
    No, I am affraid it doesn't work like that. You get very little credit from the beginning, after SHOWING YOU CAN REPAY AND MANAGE YOUR MONEY your credit limits increase. Many people get into thousands pounds of debts because a/they suddenly go mad and get that shopping illness (buy everything you see) b/get into difficult life situation.

    I would go on www.moneysupermarket.com/loans and see what is there in a way of bank loans. If your credit rating is that good as you think (did you ever had a loan, phone contract or anything else??) you will be able to get REAL 9% APR... Have a look at that site and that would also show you how much would you be paying in interest...
    • CLAPTON
    • By CLAPTON 21st Nov 08, 8:58 AM
    • 38,135 Posts
    • 26,846 Thanks
    CLAPTON
    • #8
    • 21st Nov 08, 8:58 AM
    • #8
    • 21st Nov 08, 8:58 AM
    I think you are unwise to get into debt when its not necessary and 5k for a bike is a want not a need and the fact that you are choosing to pay over 5 years tends to indicate that you dont have much money or you spend it unwisely.
    You will end up paying a considerable amount of interest.


    If you can afford the repayments of £122 then why haven't you been saving this spare cash each month.

    However it may be useful for you to know how things work:
    - lenders (like loan providers or CC companies) like to see a history of similar lending so that they can see you repay your loans/CCs regularly and ontime.
    This shows up on your credit records.

    -if you have never had a CC then there will be no history on your file either good or bad.... therefore most will therefore only give you a small limit (500 or 1000) and a APR around 25-35%.

    -obviously you are on the electoral roll

    Your best bet is to ask your bank because they will see your wage being paid in each month and know you handle your affairs well.
    A loan is likely to be cheaper than a CC.

    To get a feel for what various loans will cost you try out this loan calculator
    http://www.moneyfacts.co.uk/calculators/loanrepayment.aspx
    Try a few figure and write them down so you will not be conned by the 'flat rate' merchents with their misleading figures.
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