Are we able to get a loan at all?

zeddy_2

Hi and Merry Christmas everyone!

I have a question or two about loans, becuase after some umming and arring about what we should do, my boyfriend and I have decided to buy a new car to replace his car which has just gone bang. We are worried we are going to have trouble getting a suitable loan though as we applied to the aa for a £16k loan and was turned down.

Our credit history is not brilliant, but I wouldn't think terrible either. We have moved house twice in the last 2 years and back in September this year paid a couple of credit cards payments a day or two late (becuase we were both out of work and were finacially strapped at the time). We know we will be able to pay back the loan repayment quotes that we've had of arpund £300 a month for a £16k loan over 60 months with no payment protection, becuase in a couple of months we will be moving back in with my parents to try and save money for a deposit on a house (that's a way off at the moment though).

Could anyone suggest a loan company who will be sympathetic to our history of moving and things, who will also offer us a decent percentage as well? We are very worried that we are not going to be able to borrow the money for the car now, since the aa turned us down. (We need a car to get to work from where we live as we work 30 miles from home. So living without one is not an option).

Thanks so much to anyone who can help us with advice here, didn't know where else to turn after having bent the whole families ears about it! Also another Merry Christmas to everyone too, I hope you are all having a brilliant Chirstmas time. :xmassign:

OMAR

£16K is a bit much for a car?!

Stephen_Webber

I managed to get a 54 plate Ford Focus LX with 20K on the clock for £7500. What on earth are you looking to buy for £16000? Surely if you are wanting to save money for a house, you want to keep the amount of a car loan as low as possible, which will also make it easier to be approved?

Regards,
Stephen

BenL

As the other two posters have advised, get a cheaper car.

It'll help you save as less money going out and if you want to get a house within the next 5 years the mortgage company see the £300 a month going out and reduce the amount they will lend you as there calculations will say you cannot afford a large mortgage and a car loan.

Ben

zeddy_2

Thanks for the suggestions, but we do want this car and really that is our choice if we want to spend that amount on the car - it's a personal lifestyle choice.

Really I would just like some advice on where to get the loan from considering our circumstances as mentioned in my previous post. Thank you to anyone who can help and advise me in the right direction.

---lee---

You mentioned being out of work at some point. Banks like to see a stable work position, so that might be going against you.

Are you on the electoral roll for your current address?
Have you checked your credit files with the 3 credit reference agencies (Experian, Equifax and CallCredit)?
Do you have any credit cards that you have settled but not closed?
Have you read Martin's credit scoring article here? http://www.moneysavingexpert.com/cgi-bin/viewnews.cgi?newsid1101485056,23650,

Of course it’s your choice what car you buy and how much you spend – I don’t think the other posters meant any offence. I think they are just saying that there are probably other options to consider. I’m also curious to know what car your looking at getting? (just being nosey).

Stonk

It has been said before and I won't get any thanks for it, but it bears repeating.

In one sentence you're moving into your parents' house to save money, and in the next you're spending 16 grand on a car, as a "lifestyle choice", and to top it off you are borrowing the money. Bonkers, completely bonkers ...

The_Boss

Try getting finance from the company you are buying from - although the rates are not great, the loan is secured against the car, so they are a little better with who they lend to - if you dont pay it back, they will repossess the car.

digp

Stonk wrote:

It has been said before and I won't get any thanks for it, but it bears repeating.

In one sentence you're moving into your parents' house to save money, and in the next you're spending 16 grand on a car, as a "lifestyle choice", and to top it off you are borrowing the money. Bonkers, completely bonkers ...

ROFL

That's funny

ms_london

zeddy wrote:

becuase in a couple of months we will be moving back in with my parents to try and save money for a deposit on a house (that's a way off at the moment though).

As others have said. You are crazy!!!

It is a personal choice, and by all means go ahead if you want to, but wouldnt you rather have that money for a new house than for a new car (but meaning you have to live with your parents??!!).

zeddy_2

Hi,

Once again thanks to every one for their comments and advice that they have shared. In the end I managed to get a loan through Marks and Spencer and we have bought the car (hopefully we'll be able to pick it up next week). To Lee, the car we've bought is a Seat Leon Coupra R and we both love it!

I can understand people thinking that our decision to buy the car over saving money is strange, but I wouldn't do it if I didn't think we could do both eventually. Both my boyfriend and I finished university only 2 years ago, we have been in steady employment (though with different companies) since then, with the exception of September this year becuase I left my contract job to go on holiday in America. In this short time we already have jobs that earn 3x the amount that the car is worth, so I am fairly confident that in a years time we might be in a position to either have paid off the loan for the car or have a massive deposit to get a mortgage. At the moment a car is more important to us than a house (getting a mortgage seems like a big step) and we have been renting for the last 2 years, which sucks but it could be worse. Living with my parents won't be easy either, but if we can save up all that money then I think it is worth the sacrifice and hopefully the car will be a nice treat to see us through having to spend nothing for the foreseeable future.

Hope everyone is still enjoying thei festive season and an early Happy New Year to you all.