Advice for first timer. Trying to buy a car.

evu

Hi. Love this site but it's all very complicated isn't it. So he I am asking because I'm quite confused.

I've never had a credit card before, nor has my girlfriend but she's trying to get a new car and thought a credit card might be a good option. But I've got a few questions.

Can I use a credit card with 0% on purchases to buy a car? I'm only talking about £3000. I'm just unsure if it works for just buying one big thing then paying it off monthly till it's paid and then don't use it.

If I end up buying it from a private seller is it possible to withdraw money from a credit card? The whole "on purchases" thing confuses me...

How much is the limit likely to be? She has an annual income of 14K, hasn't missed payments before on direct debit or anything so I would of thought her credit rating was ok. I'm sure it was ok last time we checked her credit score online. Never had a loan or credit card before though.

Is it possible to pay it off early and then not use the card? Once we've bought a car we can sell the old one and have a decent chunk of it to pay off.

I know some of it may be trivial but it's all quite confusing and I've a fear of debt lol. Any help is greatly appreciated!

Cheers,
John.

Atom

A 0% card would be the best option if you pay off before the 0% time runs out, however you have not had any credit cards before so it is very unlikely you will get a card anywhere near £3000 - you would need to apply for a credit card with a sub prime lender such as Aqua, Vanquis Capital one classic etc and build a history before moving into prime lenders, if you have a good relationship with your bank then no harm in wasting one search there, they will know you better than most.

Some cards you can transfer cash to your bank but im not so sure what ones, usually comes with a higher interest when withdrawing cash.

If you go for a loan option you may be declined for having no history or you might end up with a high interest, most likely the latter.. The lack of history will be the problem for you i think - no harm in trying but don't apply for too many in such a short period that will also go against you for a few months or so.

jonesMUFCforever

I disagree slightly with previous poster - before trying the sub prime cards like Vanquis try your own bank.
If they decline you then getting a card with a high enough limit will be a big job.

Have you/her got any savings and have you factored in repayments + the costs of running a car such as tax, insurance and servicing?

chalkie99

Something else to consider -

she's trying to get a new car

Can I use a credit card

Clearly we know nothing about your situation but be very wary of buying a car for someone else, even if everything is going well now. These boards are littered with posts from people left to pay the debts of now broken relationships.

Get your girlfriend to arrange her own purchase unless you are happy to gift her the car and pay all the costs yourself if it all goes wrong.

evu

jonesMUFCforever wrote: »

Have you/her got any savings and have you factored in repayments + the costs of running a car such as tax, insurance and servicing?

She has a car atm so yea we can afford to run one, she just wants a new one. She's got £800 saved up for it and with the sale of the current car we should have at least £1500 to repay pretty much straight away. Then we could probably manage to get the other half paid within 6 months.

However, do not commit the cardinal sin of withdrawing money from a credit card as this will incur interest at astronomical rates. Also, if you are looking to buy a car from a private seller, in most likelihood, they will not accept card payments. Most dealers also charge a fee for card usage.

That was what I was worried about. Do the "0% on balance transfers" include transferring from the credit card account to a bank account? That way we could withdraw from the bank. I'm not so worried if the dealers have a charge, can't be much more than £20 or so can it?

Thanks for the help so far!
Cheers,
~evu.

evu

chalkie99 wrote: »

Something else to consider -





Clearly we know nothing about your situation but be very wary of buying a car for someone else, even if everything is going well now. These boards are littered with posts from people left to pay the debts of now broken relationships.

Get your girlfriend to arrange her own purchase unless you are happy to gift her the car and pay all the costs yourself if it all goes wrong.

Heh, I meant she* Yea, she's getting the card. I'm just asking here on her behalf and to make sure she's doing things right.

YorkshireBoy

evu wrote: »

Do the "0% on balance transfers" include transferring from the credit card account to a bank account?

Very few do. Look at MBNA, but it'll cost you a 4% fee.

I'm not so worried if the dealers have a charge, can't be much more than £20 or so can it?

You'll find it's a percentage, typically 2-3%*. Many dealers have limits though, and possibly only accept credit cards for the deposit.


* If you find a dealer who'll waive this fee you didn't haggle hard enough on the price.

evu

Sorry, but what is MBNA?

Cheers.

YorkshireBoy

evu wrote: »

Sorry, but what is MBNA?

A credit card provider.

You really are new to credit cards aren't you.

chattychappy

YorkshireBoy wrote: »

* If you find a dealer who'll waive this fee you didn't haggle hard enough on the price.

You're probably right in most cases. But my sister used to work for a car dealer where salesmen's commissions were based on the pre-fee price. So they were slightly incentivised to maintain a higher price and waive a fee rather than lower the price and insist on a fee.

evu

Thanks for the replies, and yes yorkshireboy, very new and very apprehensive. Always said I'd never get a credit card but it's either this or we save up for a year, in that time we'd lose value on the current car.

Looking at the tesco card, it has 0% on balance transferes, with a fee of 2% up to 95% of the credit limit. Could I then take that 95% and transfere it into a regular bank account and then withdraw that?

Reading some more about it, am I right in understanding you can't find out what limit they'll give you until you actually get the card? So no ringing up before hand to find out?

Also, one of the above posters (sorry, on my phone and this is a pain) mentioned "wasting a search" and I've read something about this hurting your credit score. Could someone please elaborate on this?

I said some of this might be trivial but I'm very weary about debts and want to make sure it's all crystal before we go ahead with it. All seems very technical to me, don't know how you all keep on top of it!

Really appreciate the help so far, thanks!

Cheers,
evu.