Used car, credit card or pesonal loan?

collette87

Hi everyone,

Im in a bit of a pickle. I would like to a buy a car pretty soon. I have £2000 saved, however I need about £2.5k-£3 more to cover the cost of the car AND insurance for a year. I would like to know whether to apply for a loan OR 0% interest for 12 months on a credit card.

The issue I have is that Im wondering whether if I apply for a credit card, will they give me the credit limit that i need. They'd be no point them giving me a small amount like £1k. Where as with the loan, the bank knows the exact amount you need n will say yes or no. Also when I log in to my Barclays online, they say im eligible for a loan of up to £10,000. Obviously a 0% interest credit card is much better though, but not if its a tiny amount. Also i will deifnitely be able to pay it off within the 12months.

Lastly, I think my credit history is good, i have never missed payments, I do have credit card (£300 limit), and i have no overdraft.

Any advise would be appreciated.

cheers
x

[Deleted User]

why not wait another 12 months,save some more then you can pay cash for car and insurance
the temptation not to pay the 0% cc off in 12 months will be high,and i wonder why the cc you have now has such a low limit?

collette87

Thank you,

I understand your point about the temptation, but I have already made a payment commitment in my mind. Im very careful with money so I will honour the 12 month 0% interest free. I do see your point though.

The reason my credit card is low, is because at the time I applied I was earning much less than 1k a month, however for the past 9 months, ive been earning over £1k, but i haven't put up the credit limit, although I do see the option when i log in. Also the reason I would like a car pretty soon-ish is because come september I'll be traveling a lot for placements.

So do you think a loan is pretty pointless then?

[Deleted User]

not saying its pointless but best avoided if possible,the APR on a loan of £3k will be around 14% at best as things are atm,so the cc if you can get one is the better option if you can be comitted to paying off in the 12 months,

anniecave

bear in mind you can't usually buy a car on a credit card (the transaction fees for cards are high so most places don't accept them)

you may be able to get a cash transfer of some sort to your current account with some card deals but there is normally a fee for this