Loan Help - A Car (I'm a student, both parents not working) - Urgent, please help!

pullupdatforward

Hi all,
Recently my sister passed away, she had recently got her own car (well more of a van which has been adapted for her wheelchair).

Both due to sentimental value, and the use of it we are considering buying the vehicle. It is £18,000 (an-almost brand new Volkswagen).

I'm only 21, on the final year of University study. I have quite a good amount of money in my accounts (around £30,000 which I've made all by myself over the years).

Mother previously was receiving carer's allowance, but will most probably get JSA now. Dad is on disability allowances.

Does anyone here have any suggestions on how I could go about paying for this? I'd much rather take a credit option if I'm able to pay it off over time, however much would this add in interest? Any smart ways to work with this?

Many thanks - really urgent.

Tixy

Hi

Did your sister own the car outright? Has she left a will? Who did the car pass to in the will (or automatically if no will was made). I would have thought one of your parents may have inherited the car anyway in which case you wouldn't need to purchase it.

Apologies if I have misread the situation.

If you do need to buy it from someone else then I would not use credit if you have £30k in the bank. As a student you would be unlikely to get a loan for £18k anyway. If you did the interest you would pay would far exceed any interest you are earning on the £30k in the bank.

How much you would pay in interest would depend on how long you wanted the loan over, how much you can afford to repay each month and what APR you got.

As a guide - If you had a loan over 3years with a 10% APR you would pay £2860 in interest and monthly payments would be around £195. However given your status you may not get any loan at all or it could cost you quite a bit more than 10%.

pullupdatforward

Tixy wrote: »

Hi

Did your sister own the car outright? Has she left a will? Who did the car pass to in the will (or automatically if no will was made). I would have thought one of your parents may have inherited the car anyway in which case you wouldn't need to purchase it.

Apologies if I have misread the situation.

If you do need to buy it from someone else then I would not use credit if you have £30k in the bank. As a student you would be unlikely to get a loan for £18k anyway. If you did the interest you would pay would far exceed any interest you are earning on the £30k in the bank.

How much you would pay in interest would depend on how long you wanted the loan over, how much you can afford to repay each month and what APR you got.

As a guide - If you had a loan over 3years with a 10% APR you would pay £2860 in interest and monthly payments would be around £195. However given your status you may not get any loan at all or it could cost you quite a bit more than 10%.

She didn't own the car outright, it was through 'Motability' which is a scheme for disabled people to get a car adapted for their needs. Some money was being deducted from her own allowances, as well as some being provided by the organisation themselves.

Hmm yeah I understand what you mean. The issue is that I see that £30,000 as being 'backup' money for the family, as there's basically very little income until I'm able to get a job (after graduation - but I don't know how quickly I'd get one!).

Would my parent(s) be able to get a loan, at possibly a better rate?

ILW

I believe Motability is a lease and does not have any purchase option.

Tixy

I very much doubt they would get a loan given they are on benefits.

To be honest I don't see how much sentimental value you can attach to a nearly new car. Given your family finances it would seem much more sensible to buy a cheap run around for £1-2k to last until you have graduated and got a job.

JA1000

Sorry to hear about your sister, but I don't think she would want you to throw your money away. Do not buy this vehicle, it is of no use to you whatsoever, to be cruel to be kind it is a piece of metal on wheels and will depreciate very very quickly which means you will be throwing your savings pot away, over half of it initally then losing another 60% in a few years. These vehicles do not hold their value.

She would want you to set yourself up for life, finish your finals get your degree and not worry about a vehicle which is not purposely built for you.

Buy something more useable and practical, letting go of this vehicle is the right thing to do, there is someone out there with the need much greater than you so by you having it will deprive them of it.

I would recommend that you could do something more appropriate for your sister which will have a much longer effect as a memorial and this could even be donate to charity or something.