Overdraft to pay for car?

Ostinato

Basically, is it unwise to purchase a car using an overdraft to finance it? For example, using a 2500 overdraft to pay for the car.

Thanks

leveller2911

Hi Ostinato, bit confused here, Is the car registered in your name with DVLA or in your mothers name?.. The insurance is in her name I take it???

Your saying "I'm eligable for the scrappage scheme"

Ostinato

Okay well the current car is actually registered and owned by my mother, and hence she is the lead name on the insurance with me as a named driver.

However, it is my only mode of transport and as I am paying for it it is kinda "my car"... Although it is legally owned by my mum. However, she is unable to get finance and so I would be required to purchase it outright in her name... and if I wanted it in my name then in turn transfer over ownership to me.

Fonz_2

There's a bigger problem here in that you're essentially uninsured. You're doing something which is called 'fronting' and will invalidate your insurance policy. If you're the main user of the car you need to be the main policy holder for insurance purposes.

Ostinato

No well my mum does use the car as well, but I purchase it as she does have another car and therefore this is my main transport - however I am not the only driver.

I appreciate your concerns, but was just really looking for some information regarding using an overdraft as a source of finance rather than about my insurance... cheers.

leveller2911

Ostinato wrote: »

Okay well the current car is actually registered and owned by my mother, and hence she is the lead name on the insurance with me as a named driver.

However, it is my only mode of transport and as I am paying for it it is kinda "my car"... Although it is legally owned by my mum. However, she is unable to get finance and so I would be required to purchase it outright in her name... and if I wanted it in my name then in turn transfer over ownership to me.

Your driving totally illegally Ostinato, My advice is to keep the car,register it in your name and insure in your name and build up some NCB.....
If they find out your "Fronting" then at best you,ll get points and at worse a ban, either will make it much harder to get insurance. Insurance companies are not stupid , they will investigate any claims your mother makes.......

Fonz_2

So you're the main driver.... and uninsured.

In answer to your question, yes of course you can use your overdraft, but at the same time the bank could ask for it back at any time.

somethingcorporate

Ostinato wrote: »

No well my mum does use the car as well, but I purchase it as she does have another car and therefore this is my main transport - however I am not the only driver.

I appreciate your concerns, but was just really looking for some information regarding using an overdraft as a source of finance rather than about my insurance... cheers.

It's not about whether she uses the car or not it is about whether you or her is the main driver of the car. If she has another "main" car and you don't you will be invalidating your insurance which SHOULD be a bigger concern to you than how you are going to fund a new car.

CLAPTON

I don't really understand your post

.. how much is your OD limit?
what is the APR on the OD?
what do you mean 'set up a DD'? surely your salary is paid into the a/c?

leveller2911

Ostinato wrote: »

No well my mum does use the car as well, but I purchase it as she does have another car and therefore this is my main transport - however I am not the only driver.

I appreciate your concerns, but was just really looking for some information regarding using an overdraft as a source of finance rather than about my insurance... cheers.

Your choice ,your funeral..Please don't come back on here in 12 months time trying to renege on a loan youve taken out to buy a car,only for the Police to seize and crush it due to your illegal act,oh and not forgetting the poor soul who may be unfortunate enough to be hit by your car only for your insurance company not to pay out......

Totally irresponsable.........:rolleyes:

Ostinato

Okay fair points taken about the insurance, I am getting new insurance anyway as mines has expired.

I will most likely not even use the scrappage scheme anyway and will just purchase my own car.

So can anyone give me opinions please on using an overdraft as funding? :S

- Do you know just forget it, I am going to have this thread closed. I understand your opinions and didn't actually realise I had done anything wrong and will obviously immediately rectify this. From all other aspects of this forum I have only ever received positive help and opinions, even if I have made a mistake here or there but to be honest some of your attitudes just stink and you aren't even attempting to help me out or advise me.