Buying a car - what is the best thing to do

carl_t

Hi all

I am thinking of buying a new car as mine has now done 157k miles. I now travel 47 miles each way to work and dont want the risk of any issues with my car etc.

I have an option of buying a second hand car with low mileage, bit then if something goes wrong I have to pay

or get a new car on PCP with 25k mileage limit with 3 years warranty.

either way I will have a loan or pay pcp and they both equate to around 200 pounds per month.

what is the best option here ?

TadleyBaggie

Unless you intend to use it only for commuting, 25K/year will likely see you incur an expensive mileage charge when you hand it back. Personally I would buy a 2-3 year car, ideally with some time left on the original warranty.

SeanG79

The PCP will come with a "balloon" payment at the end for you to take ownership or you give the vehicle back, there will be penalties for excess mileage. You also pay interest on that balloon amount for the duration of the finance agreement.

Essentially you need to work out overall which option will cost you the least but at the same time best suite your individual needs.

OneLife_OneShot

Save up buy a decent second hand car.

Buzby

Your PCP will have a limit of around 12k miles per year (36kin total) you'll then pay 10p/mile for each and every mile clocked up from the agreed limit.

Avoid it - get a good quality runner with no restrictions.

Laconic

carl_t wrote: »

Hi all

I am thinking of buying a new car as mine has now done 157k miles. I now travel 47 miles each way to work and dont want the risk of any issues with my car etc.

I have an option of buying a second hand car with low mileage, bit then if something goes wrong I have to pay

or get a new car on PCP with 25k mileage limit with 3 years warranty.

either way I will have a loan or pay pcp and they both equate to around 200 pounds per month.

what is the best option here ?

Tough choice. I guess the biggest question would be 'how's your car?' If it's rusting, has structural problems or upcoming major replacements, then sure, hunting for a new (to you) car is probably a good deal. But if it's in good mechanical order, is decently maintained, there's no reason not to run it another 50-60,000 miles. If it's a diesel, it should last a quarter of a million miles with looking after.

There's more to cars than monthly finance costs. You also need to factor in depreciation. Do the total costs (finance (including balloon payment), depreciation, insurance, fuel and maintenance provision) for a newer car really offset the current costs of your car?

From a pure money perspective, if the old car isn't in poor repair, I'd be inclined to save up to the point where changing it for a newer car breaks even before switching. If the old car is in good repair, selling it for the best available price will further offset any costs. Better yet, I concur with conisme: save to buy outright. Not owing money is heaven!

carl_t

the pcp is 200 pound a month, it has a 25000 a year limit on it.

like I say the loan for a second hand car comes to about the same amount, but with the second hand car I have the added worry if there is an issue with it. either way teh monthly costs are the same.

only thing is , now I have a BMW, and trading down to a seat

kinh

what ever you do, best of luck!

SeanG79

The monthly costs are the same, however at the end of the loan for the car you will own the car and can use that as a partex on a new vehicle or continue to drive that vehicle, with the PCP you will have a balloon to pay or you hand back the car and have nothing to show for it.

It depends on your ultimate objectives.

heartbreak_star

carl_t wrote: »

only thing is , now I have a BMW, and trading down to a seat

Gosh, how terrible *eyeroll* I must be through the floor with my humble Corsa...

If you do go for the PCP, be prepared for the balloon payment - I've seen far too many people caught out with how much it actually is and how fast it comes up!

I've never done PCP but have had a car on finance and also bought a reasonable second-hand car outright, and preferred buying outright. I hated the monthly payments. I do roughly 14000 miles a year if that's any comparison?

HBS x

StuC75

even at 25,000 miles per year that doesnt leave a lot of 'social mileage' if your daily round trip is 94 miles.

Your annual mileage will also quickly knock down the value of any car you do buy.. Would it be better to buy 2/3 year old car with low mileage, but then actually sell that on in approx 2 year (when low + higher mileage = Average mileage).. that way your not running your car into the ground, and moving on whilst still having some value in it..