Car finance 'encouraged' in money saving land

motorguy

iolanthe07 wrote: »

It irks me that car dealers are still allowed to quote flat rate interest. This confuses some buyers who think '6%' interest is a good deal, when in fact they will be paying 12%+ APR.

All paperwork must state the APR. All quotes must state the APR.

motorguy

newfoundglory wrote: »

As far as i'm concerned, unless the finance is free (ie. 0%) you should avoid and pay for the car outright.

0% finance sets alarm bells ringing with me to be honest. Its very often used to support a car in the marketplace - sometimes because its not a great car, or because its about to be discontinued.

newfoundglory wrote: »

However, I accept that finance is in fact a bargaining tool and should be used to discount the car further (as a customer, I would expect a minimum discount of several hundred pounds for taking out a small amount of finance). But this would vary depending on how much finance is taken out. A large amount of finance, should yield a large discount. This is of course providing the finance package can be cleared and re-paid almost immediately with little or no penalty.

I have no experience of that in action.

I'd be surprised if that did work to any great extent as its not the dealership supplying the finance but a third party. An individual salesman may offer extra discount knowing he is going to get extra commission on the finance though.

Personally I have, when buying a new car, do the following

(a) find the best price online for the car i want
(b) ask the dealer to price match. OR come very close to it. If that does not succeed, go elsewhere, or buy it online.
(c) sell my own car privately, or to a specialist dealer if its a specialist car, or hammer the dealer to give me the best price. If that does not succeed, go elsewhere
(d) IF i decide to take finance, i find the best price online and ask the dealer to price match. If they wont, then use the online supplier.
(e) avoid taking paint insurance, tyre insurance, GAP insurance, etc, etc with the dealer. They are always grossly overpriced. IF you must take out the insurance, find the best price online.

motorguy

Returning to the O/P's 'issue' though, has anyone seen any threads on here whereby people who obviously cant afford it are encouraged to take out finance agreements by people posting on these threads?

Dicky2K

I bought a new Motorbike on Finance.
I owe approx £4500 on it, and i have the money to pay it off, However, At a 0% intererest on the bike, i think im better off leaving my money in my Premium bonds so i have the chance of making more money on them, Either way ill still end up paying for the bike, But this way i can make more rather than just be 'debt free'..

Im better off being in debt :P

iolanthe07

pgilc1 wrote: »

All paperwork must state the APR. All quotes must state the APR.

Maybe in theory, but they often headline flat rate.