Taking Out A Loan (Help Wanted)

CLAPTON

whether you're likely to get a loan will depnd upon your financial circumstances which you have told us essentially nothing except you have just started a job (not good news loan wise)

so what is your salary
any existing debts
on the electoral roll?
what's on your credit reports
house owner or renting?

Phill_Anderson

As you have said that just started new job. Personally I think you should save some money before buying a new car.

tell_it_how_it_is

IMHO, this sounds like the classic running before you can walk scenario to me, though I appreciate it might not be the case.

Personally, I would be waiting to get Christmas out of the way, and then give myself an additional 3-4 months in the job to check everything was going swimmingly.

And during this time I'd be putting something away each month so I could be sure I would be able to cope comfortably with the future loan repayments, maintenance costs etc.

MOGGYMALONE

I would have thought it would be difficult to get a £12,000 credit limit on a card. I lumbered myself with a new car about a year ago and now regret it. Wish I had have just saved for one that i dont have to pay off instead of making repayments as its ended up costing me more ie. higher fuel charges, higher road tax, more expensive parts and now with extra MOT checks coming into place i will probably have to pay even more to keep it maintained. Also couldn't sell our old car no-one wants to buy it and its worth about a quarter of what we paid for it but it doesnt matter because we cant get anyone to buy it...wish i had traded in it.
Moggy

paulofcambs

Phill_Anderson wrote: »

As you have said that just started new job. Personally I think you should save some money before buying a new car.

Hope for the best but be prepared for the worst.

What's the worst that could happen?

I would suggest that it would be: You buy your new car, you can't sell your old one and then you lose your job.

If you can cope, financially, with this scenario, then go for it and enjoy your new car and job.

If you can't cope, financially, with the above scenario and it happens, you are in doo doos. Not only that, your dream car will be repossessed.


If you have a good credit history with your bank, it's probably the cheapest method of borrowing money. You should also talk to them about early repayment penalties etc.

bill_whu

As for the questions:
I'm 23, living at home with parents (happily), no plans to move out anytime soon (I'm sure someone will have something to say regarding the matter!)

I haven't checked my credit rating but have no reason to have a bad one. Is there a way to do this free these days? I read about Noddle but they told me they're not accepting sign-ups.

I am currently earning over £25k.

I know people will snap at me and tell me I'm wrong for doing this, however my current car is likely to lose value much quicker than the one I am intending to buy which is part of the reason. I'd probably lose more in keeping it for a year and then buying the new one than I would in paying off a loan over two years.

I'll be popping to my bank over the weekend and explaining my situation, thanks for the advice on that.

Let's just say I feel quite confident in my job as the company needs me more than I do them in some ways, the only way it could go heavily tits-up is if the company runs into trouble realistically.

If I was to get myself in a real financial state, I would just sell the car and cut my losses, since I would only have £6k odd remaining on the loan after the initial pay-off, I could then sell the car again for £12k, pay the remaining £6k back to them and then be left with £6k again surely? I fail to see how I could lose there, other than the dream car, and it'll teach me a lesson while giving me a slap on the wrist not to do it again.

opinions4u

I'd suggest caution.

But then I'm a bit dull.

Get through the first 6 months in the job. Make sure it's the right job. Save up a bit.

Then do the car dealing / borrowing stuff.

Best of luck. And don't throw away a chance to save up a house deposit simply because you want a better car. Look to do both.

Lessbutbetter

I am currently earning over £25k

Surely you're saving way over a grand a month by living at home. Could you not save a good portion of your wage for 6 months and then sell your car and buy it straight up that way?

It sounds like you've just started this new position and believe you're golden with a steady wage, but i'd seriously wait until you've got another 6 months under your belt before making decisions like taking on 50% of your salary in debt.

charleyroo

OP

Without getting into anything else in debate in this thread, just to answer your question using my own experience;

have just taken a loan out with Nationwide @ 6.1% for £8k. Am on £27k, no other debts except my mortgage (which is with them, I've had it since March so no great relationship with them). If I took it over 2 yrs it was 8.9% but when I adjusted to 36 months the APR came right down.

I was a bit dubious about this, tbh I don't want a loan for 3 years, but when I queried with them, you can make unlimited overpayments, whenever you want. When you settle the loan if there's less than 12 months gone you pay 30 days interest on the amount outstanding I believe (so all you do is pay it down to £10 then settle it I think!)

The best bit is they 'soft search' you before you make a full application, if you get a low-ish APR they are likely to accept you.

Hope I've answered your query.

Poosmate

I have no opinion on what you should or shouldn't do but the only thing I'd be thinking about is that we're just coming into winter and possibly snow and ice. I'd be a nervous wreck driving £12k's worth of my pride and joy out on those slippery roads - you may have every faith in your winter driving and the ability of the new car but what about everyone else?

I think I'd rather risk £6k in the snow and ice this year than £12k.

Poo