CC, loan - new car?!?

loftty_2

Hi,
I'll get straight to it.
I have a loan @ £6400-round about-left for 54 mnths and in desperate need of a new car of around £3000.
I spoke to the bank and ask to up my loan to £9400, which they said was fine but my payments would go up from £156 to £240 a month.
My question is:
Am I better off getting a 0% CC with £2250 limit and scraping the rest together, using that £100 a month to pay off CC.
It might sounds like a stupid question I know but I just wondered what other people think.
Also circumstances are about to change as we are having a baby, my husband can afford to pay for the above.
My credit score is GOOD not excellent but not poor either.
Hope this makes sense! Thanx

TFD_2

loftty wrote: »

Hi,
I'll get straight to it.
I have a loan @ £6400-round about-left for 54 mnths and in desperate need of a new car of around £3000.
I spoke to the bank and ask to up my loan to £9400, which they said was fine but my payments would go up from £156 to £240 a month.
My question is:
Am I better off getting a 0% CC with £2250 limit and scraping the rest together, using that £100 a month to pay off CC.
It might sounds like a stupid question I know but I just wondered what other people think.
Also circumstances are about to change as we are having a baby, my husband can afford to pay for the above.
My credit score is GOOD not excellent but not poor either.
Hope this makes sense! Thanx

Why do you mention a £2250 limit out of interest?

YorkshireBoy

What was the original loan taken out for?

And why don't you desperately need a new car at £1,500 or less?

Is your husband's job secure? And if so, what does he do and where does he do it?

loftty_2

I think this is probably the limit I could get as I had a 0% CC last yr and tis was my limit.
Do u think I coud ask for more??

naijapower

If you sure you can clear the 0% CC during the promotional period, then go for it. But you have to sure else it would cost you more

loftty_2

Original loan amount was about £6600 I think??
Could do with a car that'll last 5yrs or so because of family growing.
His job is secure. He's a computer programmer - I know it has a posh name but I can never remember his title! He works in Cambridge.

loftty_2

I would switch after 0% period finishes - definately as I would ot pay the high apr rates they charge after!

YorkshireBoy

loftty wrote: »

Original loan amount was about £6600 I think??

Sorry, I meant it's purpose.

But while we're on the subject, you've only paid off £200 on the loan since taking it out?

Only you know your finances (unless you disclose them here), but a word of warning on the credit card. You could get an SBT card which would pay cash into your current account (gives you more options, ie private or trade), but one of these, MBNA, are known to be ruthless once the 0% has expired and often ramp up the interest rate (34.9% is not uncommon).

If your circumstances change in the meantime your CC debt interest rate could be 3-4 times what a loan would be.

Maybe a loan would be better?

loftty_2

Purpose was to consolidate previous debts here and there ito one place as I was trying to get finances sorted because we wanted to start a family. But our car has nearly given up,it wouldn't start the other morning and having a baby we need something that is reliable.

TFD_2

You don't need to justify buying a car! People on here can be incredibly self righteous...

You may pay slightly more doing it through a loan, but you have no hassle then with moving debt around if not paid off within offer period. Also with a loan, you can budget the monthly payment, and it will be paid off in a fixed amount of time - it's easy to let card debt drag out.

loftty_2

Good point. But if I can get away with paying less interest surely that can only be a good thing.
I think I'm just looking for reassurance really, to make sure what I'm thinking is the right thing to do.
I hate being in debt-who doesn't?-but its a necessary evil!