Buying a car with a credit card!

MEOW2_2

**** The title is susposed to read "Buying a CAR with a credit card!" Silly me! Sorry!

Hiya everyone

First time poster looking for some advice, so be nice!

Right, basicaly I'd love a new car! There's nothing wrong with my old car, he's never let me down, although he does lack a few luxuries such as power steering!! I live with my parents and luckly for me the only things I have to pay for each month are my phone bill (Contract), my car insurance (I'm paying more than my car's worth and it's only fire & theft, it's awful, but that's another matter! ) and my petrol. Which adds up to around £150-180 a month, depending on how thirtsy my car feels that month!

I'm an apprentice, earning £110 a week (I get paid weekly). It's a full time job and I've been here almost a year now, and my employers have said they want to offer me a permenent job with a proper wage asap!

I could save for a new car, which I have been doing, but it's going to take me awhile at this wage as you can imagine! So I was thinking using a credit card and tarting, but I have a few questions.

I've recently turned 18 so I've never had a credit card before or ever thought about my credit score, so do you think I'll be accepted? And what sort of credit limit will I get? I was imagining it's going to be quite a low limit due to my earnings, and if so I was thinking I could take a loan, put the debt on a 0% card right away so I don't get charged interest, then if I don't pay it off within the 0% limit I'll swap it to another 0% card.

I understand alot of places that sell cars don't except cards, or if they do they charge a fee, so with the loan route I'd have the cash right?

I was looking to borrow around £6k, think I'd be able to get that much? Or am I mad for even thinking at my age I can get a half decent car without my parents!

Thanks for reading my blabber!

Typhoon2000

You wont get a 0% card with no history, only one with a high APR and probably not more than £250-£500 credit limit to start. Car dealers will take payment by credit card but will probably want an extra 2.5% or so to cover their fees. Anyway there's no point do that with a credit card that charges interest. Your bank is the best people to talk to for a loan. Dont think they will offer you £6000 though. Consider a car you can buy with savings only.

MEOW2_2

Thanks for the quick reply

My boyfriend applied succesfully for an Egg 0% card mmm.. before Xmas I think, he's 19 and in full time employment, earning 14k PA and has never had a credit card before. Maybe I should apply and see? Would that hurt my credit rating?

I know it's much safer using savings, but I can't imagine myself with my little fiesta for much longer. Maybe I'll speak to my bank tomorrow, I'm sure they'll have a quick giggle at me for wanting so much!

williham

It's not true that you won't get accepted for a 0% card, but it's unlikely. I got a card with my bank when I was 18 and was accepted for a 0% card not long after that.

no_more_cards_for_me

Save then spend.

If there is nothing wrong with the old car then make do for the time being. The last thing you want to do is tie yourself into a finance deal and spend all you monthly income.

When I was 18 my motorbike was on finance, I struggled to pay for it and have a social life!!!!!!!!!


I'm sure you will soon have other things to spend your money on !

MEOW2_2

Also, if I was to take a loan out with my current bank, and put that debt onto a 0% card with 0% transfers as well. One, how would I do that? And two, what would the monthly repayments be like? I've read Egg's small print on it, but it doesn't make much sence to me, I'll post it below! Thanks

Repayments Your monthly repayments are taken by Direct Debit from your bank account.

The minimum payment is the full Revolving Balance if it is less than £5, but otherwise the greater of (1) 2% of the Revolving Balance or (2) the total of (i) interest billed on the statement on the Revolving Balance (ii) 1% of the Revolving Balance (iii) any Card Repayment Protection premium shown on your statement and (iv) billed fees for late or returned payments shown on your statement or (3) £5.

Plus, for each Transferred Balance made during an introductory rate or promotional rate period for Transferred Balances (but only during that period) the full amount of the Transferred Balance if it is less than £5, but otherwise the greater of (1) 2% of the Transferred Balance or (2) the total of (i) interest billed on the statement on the Transferred Balance and (ii) 1% of the Transferred Balance or (3) £5.

CannyJock

Egg minimum repayment explained here http://forums.moneysavingexpert.com/showthread.html?t=2313527&highlight=egg+minimum+repayment

A card can be used to clear a loan in full - you wouldn't apply for a loan and then put that debt onto a 0% card

MEOW2_2

CannyJock

Thanks for the reply, that's interesting, could you explain that in more detail?

Sorry I am such a newb I know!

downhillfast

Are you planning on getting the new car when you have the proper job with the proper wage or before? As it stands earning £110 a week I don't think it would be possible for you to pay say £40 a month phone, say £80 a month insurance (guess based on your age and value of proposed car) and then afford to put £130 odd of fuel in it a month... AND repay the loan on it aswell!

anonymoose_3

Hi,

I would seriously re-consider thinking of getting a car on a credit card. Even if you did get one with 0% it would only be for a few months... the longest I can see for new purchases is 12 months. Would you be able to pay it all off in the 12 months that it was interest free, what would you do if you couldn't get another 0% card to do a balance transfer on? You would then have to pay the APR on the card too.

I got my first credit card when I was not much older than you, 8 years on it's one of my biggest regrets. I really wish I hadn't been taking in by one back then.

You might want to have a quick read of this thread too
http://forums.moneysavingexpert.com/showthread.html?t=2352109

x

catflea

Credit cards are things to be paid off in full each month. They are very good devices for building your credit score though. Get one, put your petrol on it and pay it off in full each and every month then after a little while you might be able to get the 6k loan to get that car you want - or even better you might have saved up enough to buy it outright