Soon to be Barclays staff, need £10,000 loan for car.

SimbaSimon

MARKMAKAVELI wrote: »

Would you all agree that leasing is a good option for me?

Depending on the contract, I could opt out at any time and they would keep the car?

While leasing short term is definately more attractive then buying a car outright I still think its the more expensive route and probably unnecessary. Imagine this, you lease a new car for £200 a month for 12 months. After 12 months you've paid £2400 but don't actually own anything. Now instead put that £200 a month to a reasonable priced second hand car and you would have paid for it completely and after x amount of months and have an extra £200 a month spare. And if in 9 months time you have a new partner and feel like moving out of the parents house you've got another £200 spare a month to put towards rent and bills instead of paying off car debt/leasing.

I realise a new car is a very attractive option but long term its just more expensive and it'll just look like any other used car in a few years time!

MARKMAKAVELI

Cheers Jon, I do see where you coming from which is why i am considering other options such as AndyS's lease.

It does/did all hinge on the career going the way I hope it does and I appreciate that is very risky.

You seem to be giving me a glimpse of the real world in terms of rent, debts etc and I know whay you are doing this because the impression I have given is of someone who is financially unaware with limited life experience. I have rented a place before, paid off car bills, paid flat bills, saved for travelling and gone out every weekend and all on 15k! Despite the impression I have given on this thread I am usually very financially aware, I contingency plan etc. I have spreadsheets for everything!

I know I lack in certain areas, hence this thread. Thanks for your time, it is appreciated.

Jon_B_2

No problem and good luck in your new job.

DaveLy

I'm 25, 45k+ a year with very little outgoings.

I drive a ford fiesta 1.4, I don't do anything but drive it from A to B, it does the job, and i pass lots of fancy AUDI's and BMW's on the road :-)
If someone keys it, boots it, sets it on fire, or someone crashes into me, I simply wouldn't care all that much :-) Thats one massive benefit.

I've decided to continue saving money, and keep it for another year.

First year costs:
£650 car, £960 insurance, £200 break fix, £100 fixes from MOT
£140 tax, £45 MOT, £600 fuel
Total: £2695 for a years usage

Second year costs:
£450 insurance, £200 complete service and fixes done for MOT
£140 tax, £45 MOT, £600 fuel
Total: £1435 for a 2nd years usage

Your £10,000 vehicle will lose more value via depreciation than the costs of my fixing my little ford fiesta :-)

Then take into all car related costs
1st year was £224/month for EVERYTHING
2nd year is £119/month

Say you take home £1000/month, in my case it'd be 25% your income.

You want a loan for £10k over 5 years, thats £220/month for instance, factor in all other bills and you'll be close to £450 to £500/mo. About 50% of a £1000 income!

£220 of which you will have to pay regardless of job due to loan repayments (in the event you lose job and cannot afford to pay, say goodbye to your credit rating)

And of that £220 about £140 is the rough return per month, if you wish to sell the car based on Loan interest + factoring in depreciation. Thats basically £1000 a year... doubt your repair bill would amount to even half this on a cheap 2nd hand car.

katebl

Mark,

You remind me of myself!! I worked for Barclays (started off as a cashier, promoted up from there till I realised I hated the sales culture) and in 2005 decided to buy a brand new Renault Clio - Barclays staff loan actually worked out no different to a loan through RFS in the end so I went with the dealer finance - so be warned a staff loan may not be as preferential a rate as you'd expect. I can also say that after selling the car this year (admittedly to family so on the cheap) it had depreciated by 5k. Add to that the cost of insurance on a brand new car, as well as the money I spent on shiny alloys and the like, and I figured the car cost me (not including petrol) about 12k for the 4 years I had it. 3k a year - assuming your outlays are similar to mine - is a big chunk out of 12.5k!

My advice would be, go for something cheaper for now - because being a personal banker is a pretty awful job with a lot of unreasonable targets, and if you do get there you may find you don't even like it!

Good luck

Brock_and_Roll

Mark,

I have worked in banking all my life and currently earn many times your salary...however all I can afford is a 10 year old motor with 110k on the clock. I am afraid wives, mortgages, kids and living costs account for every penny I earn. But on the bright side, if it blows up tomorrow, I dont owe a penny on it and will buy another one!

When I was your age and got my first decent pay rise, I went out and bought a new Subaru Imprezza on a PCP. Great car but I'd hate to work out how much it cost me per day of ownership (and it didnt help with the girls either!). My best mate had miles better luck with an old mini!

MARKMAKAVELI

Latest update:
I can get a nice enough car for £180 p/m on 2yr lease. Free road tax for 2yrs, warranty 3yrs, so there shouldn't be any further major costs from MOT's etc.

No 10k loan, no 5yr commitment, affordable repayments even with insurance I still have £150 left at end of month, after going out etc. I won't do this until I have had a month in my job.

Thoughts?

andys15

MARKMAKAVELI wrote: »

Latest update:
I can get a nice enough car for £180 p/m on 2yr lease. Free road tax for 2yrs, warranty 3yrs, so there shouldn't be any further major costs from MOT's etc.

No 10k loan, no 5yr commitment, affordable repayments even with insurance I still have £150 left at end of month, after going out etc. I won't do this until I have had a month in my job.

Thoughts?

Well I think its a better solution than the 10k loan. I would want to know what would happen if worst case scenario happened and you cannot afford it, missed a payment. Could you hand it back after say 8 months no questions, would you lose a deposit? have a default?

Lokolo

MARKMAKAVELI wrote: »

Latest update:
I can get a nice enough car for £180 p/m on 2yr lease. Free road tax for 2yrs, warranty 3yrs, so there shouldn't be any further major costs from MOT's etc.

No 10k loan, no 5yr commitment, affordable repayments even with insurance I still have £150 left at end of month, after going out etc. I won't do this until I have had a month in my job.

Thoughts?

Is the warranty unlimited mileage?

MARKMAKAVELI

Yeah i'd have to pay up at least 50% of remaining balance if I quit if after a year, so at least 1k. Even if I was out of work for 2 months, it only adds up to £400 on repayments, whilst not ideal it's not a 10k loan hovering over me.

Warranty is based on 10k miles p/a, I defo won't go over 15k an that would be £195 p/m. 3 year warranty also.

I plan to start in the job an do it for a couple of weeks before deciding on car. Not ideal but again, not as bigger risk as before.

Appreciate all your help, you have spoken and I have listened. A great partnership. Thanks