Buying a used car

costingbunny_2

Hi
I am looking to purchase a used car from a BMW showroom. List price is £7,000 and I am trading in a very old banger. Have the following questions?

How much might I get for the part ex (they will take it)?
Should I pay for the car from my savings (I can afford it) or should I pay part cash and part 0% credit card? Or all on 0% credit card? Or are there any credit cards with gifts attached I could use or a way of getting other bonuses, nectar points etc?

Thanks

StrongWork

Is this a BMW approved used car from a main dealer? If so, I suspect the amount you get for your banger will be minimal (if anything)

costingbunny_2

yes it's a BMW approved centre but they will take my car. I am testing driving it later today - anything I should know/ask? Any more ideas on how to finance it?
Ta

BugsyBrowne

costingbunny wrote: »

Hi
I am looking to purchase a used car from a BMW showroom. List price is £7,000 and I am trading in a very old banger. Have the following questions?

How much might I get for the part ex (they will take it)?
Should I pay for the car from my savings (I can afford it) or should I pay part cash and part 0% credit card? Or all on 0% credit card? Or are there any credit cards with gifts attached I could use or a way of getting other bonuses, nectar points etc?

Thanks

What BM are you looking at?

rev_henry

Be aware that the dealer will probably add 2.5% onto the purchase price for credit cards as that's what it costs him. This might outweigh any bonus points etc. The best cashback credit card pays 5% for the first 3 months, but only up to a max of £100, and that's less than the extra the dealer will charge for cc, if he accepts amex at all.

If you use a 0% card you're basically stoozing - incurring no interest charges on the card balance but earning interest on the savings which you're going to use to pay off the card eventually. So you need to find out the following:

1. Whether dealer will charge you the extra 2.5%
2. Whether the interest you'll earn over the course of the 0% period is more than the 2.5% surcharge.
3. Whether or not you're disciplined enough to not touch the savings and ONLY use them for paying off the card. I'd put the £7000 in a savings account locked away for a year (longer if 0% period allows) so that you can't touch it AND you'll get more interest. Then use normal day to day money to make the min repayments until the last month of 0%, at which point you pay off the whole balance.

Personally I think it'd be a bit of a palaver, so I'd have to be making significant profit on the savings for it to be worthwhile.