Credit card for £20k car loan?

[Deleted User]

pay 20k for a car?maddness

somethingcorporate

Well done and it should be encouraging for the OP to hear. You must have an absolutely fantastic credit record (or have a very good existing relationship with the lenders). Mine was with an institution I have had no previous connection to so may explain my relatively modest opening balance.

I find many banks are fickle creatures, you hear many stories of credit limits being increased/decreased/rates played around with without any request from the credit card holder - I have rinsed in excess of £100k through my original Nationwide CC over the last 5 years, never paid a penny in interest and they have never made a squeak about upping my rate or changing my (£6k) limit.

bris

woodbine wrote: »

pay 20k for a car?maddness

Thats just a run of the mill car these days. You don't get much for 20k now.

JimmyTheWig

igiiroko wrote: »

Thanks all. I'd previously got the impression that the 0% credit card route was a little-known but viable alternative to dealer finance. From the collective wisdom here, it seems I was mistaken.

It's a worthwhile plan for some people. E.g. buying a car for £4k that you can pay off within a year you're (probably) better off using a 0% card. But a £20k car that you'll have to pay off over 4 years I'd say a card would be too risky.

I'm now inclined take up the Audi Finance offer, which is certainly much better than anything I found on moneysupermarket.com and comparethemarket.com.

My only comment is to check the APR. Car finance often quote a "flat rate" interest rate. As a rule of thumb you can double this to get an APR.
So if you're offered 7% flat rate from Audi or have seen 10% APR on a personal loan, the latter is probably better.

thenudeone

bris wrote: »

Thats just a run of the mill car these days. You don't get much for 20k now.

That depends entirely on your lifestyle and expectations.

Borrowing money you don't have to finance a lifestyle choice (which is what a £20k car is) rather than a necessity is, as has already been said, madness.

If someone has done very well and has the money to buy a car for £20k, £100k or £500k, that's fine by me; but to BORROW to do so is almost certainly a poor financial decision.

thegoodman

thenudeone wrote: »

That depends entirely on your lifestyle and expectations.

Borrowing money you don't have to finance a lifestyle choice (which is what a £20k car is) rather than a necessity is, as has already been said, madness.

If someone has done very well and has the money to buy a car for £20k, £100k or £500k, that's fine by me; but to BORROW to do so is almost certainly a poor financial decision.

I agree. I rather have an old car for 4k then take a loan out for 20k for a car. Asking for trouble.

agrinnall

thenudeone wrote: »

That depends entirely on your lifestyle and expectations.

Borrowing money you don't have to finance a lifestyle choice (which is what a £20k car is) rather than a necessity is, as has already been said, madness.

If someone has done very well and has the money to buy a car for £20k, £100k or £500k, that's fine by me; but to BORROW to do so is almost certainly a poor financial decision.

Agree entirely, I bought a £34K Porsche for cash a few years ago because I had it and could afford to spend it, but the last time I borrowed any money for a car was in 1984, not long after I'd started work, and I made sure it was one well within my means to repay.

ahxcjb

thenudeone wrote: »

If someone has done very well and has the money to buy a car for £20k, £100k or £500k, that's fine by me; but to BORROW to do so is almost certainly a poor financial decision.

How else do you think all these people are affording to drive Audi's currently?

I went in the local Audi showroom a month or so ago to test drive an A4. I over-heard lots of conversations there of prospective buyers, all earning average salaries with only 1-2k to put down as a deposit. They're going to finance the rest.

Utter utter madness. No wonder everyone is such financial straits when idiots like this are spending money (20k in the OPs case) they clearly don't have.

CKhalvashi

I'd never borrow for a car either, sorry.

I've got mine on lease as it's more tax-efficient (13% interest and 100% tax deduction vs. 10% decreasing per year), but the money was there to pay for it before I got it; in fact, it's sitting in a separate unused bank account with Santander that only gets used for one CC, earning about 3% interest and the relevant amount being switched over once a month, after a further 45 days have been exhumed interest free.

Buy a £2k car, run it for 2-3 years and replace it for an ex demo (not a new one) when you have the money.

I've only ever had one brand new car (which is the one I've got now, as nothing ex-demo was suitable in stock when I needed it); everything else has been acquired at 3-ish months old.

CK

NickX

ahxcjb wrote: »

How else do you think all these people are affording to drive Audi's currently?

Utter utter madness. No wonder everyone is such financial straits when idiots like this are spending money (20k in the OPs case) they clearly don't have.

You are missing the bigger picture here. If "idiots" were not able to make purchases using credit, then the whole country would be in a much worse economic condition.