Best wat to finance new car??

eschaton

Lot of good advice on here, and also bad advice.

Car on a mortgage - how so many people re-mortgaged and got a new car thinking they were doing well, forgetting that they may have been paying for the car for 20+ years, long after the car was gone.

Leasing, yeah great, few months in, lose job, tied to a long term lease. Where do I sign?

Unless leasing is financially better taking into account leasing/finance charges, restrictions such as mileage, fixed term, future retained value, interest on savings etc.. then obviously cash will be best.

I borrowed over £14k of my cars cost nearly 6 months ago as it was 0%. Price remained the same whether I took it or not as it was funded by the manufacturer. Otherwise it would have been cash all the way, just as I have done with every car I have bought since 2000.

Inactive

pgilc1 wrote: »

And what about the 99.9% of people who have a successful finance experience?



Did you buy your house for cash then?

Where did you get the 99.9% figures from?

I do not live in a " house ".

King_Nothing

pgilc1 wrote: »

Really, really, really?

So putting £6K of your hard earned into a car thats going to return you £3K in three years time is a good idea?

Would you not agree spending £200 a month and keeping your £6K in the bank is a better idea?

A car isn't a savings account, why do you keep insisting as if it is? Everyone know's they are a depreciating asset, and not everyone factors that into the equation when buying a car, plus they don't spontaniously combust at three years old, you can keep them for longer.

If someone wanted £6k and not £3k in three years time, they would put their £6k in the bank, and not buy a car, but the matter of the fact is, they want a car, and I seriously can't see how renting something at £200 a month which you don't and won't own, is a viable alternative to owning something outright.

motorguy

Inactive wrote: »

Where did you get the 99.9% figures from?

I do not live in a " house ".

Because you are quoting the (few) people who have problems with finance as definitive evidence that finance is a bad idea. What i am saying is what about the 99.9% of people who dont have problems with finance?

"I do not live in a 'house'" - ok, i will rephrase, did you buy your 'home' for cash then?

motorguy

eschaton wrote: »

Leasing, yeah great, few months in, lose job, tied to a long term lease. Where do I sign?

Unless leasing is financially better taking into account leasing/finance charges, restrictions such as mileage, fixed term, future retained value, interest on savings etc.. then obviously cash will be best.

Firstly, i was referring to those people who say 'cash is best' when i said leasing may be cheaper. If those people who had the cash sitting there instead leased or financed it *may* work out cheaper. Of course in that scenario people would still have the cash sitting to make the leasing payments, would they not?

Personally, i have income protection insurance so should i lose my job i dont have to suffer a massive change in lifestyle until i get another job.

I would strongly recommend it.

motorguy

King_Nothing wrote: »

A car isn't a savings account, why do you keep insisting as if it is? Everyone know's they are a depreciating asset, and not everyone factors that into the equation when buying a car, plus they don't spontaniously combust at three years old, you can keep them for longer.

If someone wanted £6k and not £3k in three years time, they would put their £6k in the bank, and not buy a car, but the matter of the fact is, they want a car, and I seriously can't see how renting something at £200 a month which you don't and won't own, is a viable alternative to owning something outright.

Well, i'm sorry you dont get the bigger picture.

Cost of ownership of a car isnt about just buying it, its about the depreciation, the running costs, etc. I think just looking paying 'cash' purchase price and then believing (a) that you got the best deal and (b) that someone who finances their car 'obviously cant afford it' - without considering all the factors and all the alternatives is very naive.

But there you go.

motorguy

eschaton wrote: »

I borrowed over £14k of my cars cost nearly 6 months ago as it was 0%. Price remained the same whether I took it or not as it was funded by the manufacturer. Otherwise it would have been cash all the way, just as I have done with every car I have bought since 2000.

You said above

eschaton wrote: »

Leasing, yeah great, few months in, lose job, tied to a long term lease. Where do I sign?

So surely if you lost your job, you'll have finance payments anyway until the car is paid off - whats the difference?

Also, did the 0% finance in this case not allow you to buy a car that you otherwise couldnt afford - did you not tell us on the previous page thats why you are so against people taking out finance?

motorguy

eschaton wrote: »

I borrowed over £14k of my cars cost nearly 6 months ago as it was 0%. Price remained the same whether I took it or not as it was funded by the manufacturer. Otherwise it would have been cash all the way, just as I have done with every car I have bought since 2000.

Its the contradictions in your posts that surprise me.

Correct me if i'm wrong here, but you bought a Peugeot 308 at £25,500, financing £14,000 of that on 0% finance?

But you think you got a 'great deal' because you got 0% finance? :eek:

Also, you told us on the first page that people who have to use finance 'obviously cant afford it' but you had to finance £14,200 to buy your car?? What does that tell us if we apply your rules?

Unfortunately you're a prime example of being sucked in by a 0% finance deal. You've bought a car thats going to be worth a poor 36% in three years time (according to industry backed figures published in What Car?) so that'll be around £9000. By the time you've it paid off, it'll be worth £7,000 tops, so theres a full £18,500 you'll have lost, to drive a Peugeot 308 for four years.

And your approx £10,000 deposit that you saved up is now gone in just a few months - a 2010 version of your car can be bought for an easy £18K from a main Peugeot Dealer, meaning its trade price is around £15,000.

Still, as long as you *think* you got a good deal, thats the main thing i guess.

bigjl

Leasing is never cheaper if you intend to keep a car for a long time, it is only good if you treat a car as a comodity to use for a few years and don't want the hassle of disposing of it. After all the leasing company makes a profit, this profit would be yours if you bought the car, obviously the lease co gets cars at a discount.

An example, London Ambulance Service has historically bought its FrontLine Ambulances, driven them into the ground for about 10 years then thrown them away, or donated them to Cuba.


In 2003, a bright spark said that they could save money by leasing, a good idea if you where to change the fleet every five years, but they don't, result these Ambulances which are now 7 years old are still being leased. The lease company must be laughing in their beer, or probably something more expensive.

The new trucks cost about £140000 each, not sure how much the lease costs where, but it is believed to be in the Millions pa.

If you can use the leasing costs to offset against your tax liability they are a sound business proposition, if, like the LAS you have a budget then they are a stupid idea, after all the Leasing Co is in business to make money not be your friend and save you money.

Likewise if you like the latest car, without the hassles of selling at the end and want to know control your outgoings then they are great.

If, like the OP, you are looking for the cheapest purchase vehicle then anything you do that doesn't result in you owning the car is not going to work, if you buy on three years 0%, after the car is paid for it is yours. If you keep it for 10 yrs, your monthly costs of ownership are zero, you just pay for maintenace, which is a constant. We all have opinions on this subject, these may work great for that individual, but we aren't the OP, so all advice has to be aimed at the OPs circumstances.

Which leaves us with cash or interest free finance.

motorguy

bigjl wrote: »

Leasing is never cheaper if you intend to keep a car for a long time, it is only good if you treat a car as a comodity to use for a few years and don't want the hassle of disposing of it. After all the leasing company makes a profit, this profit would be yours if you bought the car, obviously the lease co gets cars at a discount.

An example, London Ambulance Service has historically bought its FrontLine Ambulances, driven them into the ground for about 10 years then thrown them away, or donated them to Cuba.


In 2003, a bright spark said that they could save money by leasing, a good idea if you where to change the fleet every five years, but they don't, result these Ambulances which are now 7 years old are still being leased. The lease company must be laughing in their beer, or probably something more expensive.

The new trucks cost about £140000 each, not sure how much the lease costs where, but it is believed to be in the Millions pa.

If you can use the leasing costs to offset against your tax liability they are a sound business proposition, if, like the LAS you have a budget then they are a stupid idea, after all the Leasing Co is in business to make money not be your friend and save you money.

Likewise if you like the latest car, without the hassles of selling at the end and want to know control your outgoings then they are great.

If, like the OP, you are looking for the cheapest purchase vehicle then anything you do that doesn't result in you owning the car is not going to work, if you buy on three years 0%, after the car is paid for it is yours. If you keep it for 10 yrs, your monthly costs of ownership are zero, you just pay for maintenace, which is a constant. We all have opinions on this subject, these may work great for that individual, but we aren't the OP, so all advice has to be aimed at the OPs circumstances.

Which leaves us with cash or interest free finance.

We seem to have had digressed into a different conversation stream.

As i said in my first post, the O/P needs to negotiate the deal for the car first, then negotiate of the deal for the finance. IF 0% finance happens to be available - and its only sometimes on a select few new cars (which the o/p may not want) - then it would be worthwhile doing so.

Use the boards on this forum to find the best finance rates, or one of the comparison sites and ask the supplying dealer to match the deal.