Purchasing a car with a credit card, advice

Cpu2007

I have seen a few posts regarding this method but I'm a bit confused and will appreciate if someone can help me with it.

I am looking to buy a new car(a used audi). The price of the car will be around 20k(this is the maximum I'll be willing to pay but I found already some cheaper).

I know that 0% APR don't really exist and never did on manufacturer like Audi. However some users suggested using 0% cc and then pay off monthly on this cards where the only interest I'll be paying,will be the charge that the dealer will apply for paying by cc.

Can someone explain me how this works and does it work on on big amounts like 20k?

At the moment I have amex and mastercard from lloyds and also gold amex that I have recently started to use.

Thank you

[Deleted User]

You almost certainly won't get a 20k limit with a 0% promo. Limits don't tend to run that high these days.

Plus you'll probably pay a 2-3% fee to the dealer for using a card.

Cash would be the best option.

Cpu2007

I am aware that there will be a fee for using a cc(as I mentioned above)

So let's say that I have to pay £600 fee
Are the alternatives to cash?

I know cash will save me money but it is not possible for me to buy by cash at the moment. I can afford to pay up to £500 per month. I know many would say that then I should wait till I can afford it.
However, I'm thinking of buying a new (more fuel efficient car) as my current one is giving some problems and I just want to sell it; instead of buying another cheap one and wait till I have full cash before buying the one I want, I'm thinking of going straight for the car I like and keep it for years.

CLAPTON

Cpu2007 wrote: »

I am aware that there will be a fee for using a cc(as I mentioned above)

So let's say that I have to pay £600 fee
Are the alternatives to cash?

I know cash will save me money but it is not possible for me to buy by cash at the moment. I can afford to pay up to £500 per month. I know many would say that then I should wait till I can afford it.
However, I'm thinking of buying a new (more fuel efficient car) as my current one is giving some problems and I just want to sell it; instead of buying another cheap one and wait till I have full cash before buying the one I want, I'm thinking of going straight for the car I like and keep it for years.

if you can only afford 500 per month, then even without interest it will take over 3 years to repay 20,000 debt.

It extremely unlike you get a 0% card with a limit of 20,000 and even more unlikely that you will get one with that plus over 3 years at 0%.

You choices are get a cheaper car and/or get a conventional interest bearing loan.

StuC75

Even if you were to get a high enough credit limit to allow the transaction now, it is unlikely that it would 0% for a long enough period to pay off the card.

You would then face the risk of getting another card that you would then be able to transfer onto after, with then a much higher follow on rate..

Unless you budgeted to only spend whatever you could definitely pay off within that time..

True_Blue_3

I got a 26 month 0% credit card with a 10k limit. Not that I even wanted that much. So stranger things have happened.

I def would not get such a high purchase on a credit card though.

N1AK

CLAPTON wrote:

It extremely unlike you get a 0% card with a limit of 20,000 and even more unlikely that you will get one with that plus over 3 years at 0%.

Clapton's almost certainly right. Limits like that are rare at best on new credit cards these days, let alone on 0% cards. You'd also have to move between 3+ cards over the life of the debt and would be reliant on finding more 0% cards or paying considerable interest if you couldn't.

By all means take a look for a 0% card and if you can find one offering a high enough limit give it a go. You might even, possibly be able to split it over a couple of cards (not my suggestion but worth knowing).

I'd consider comparing the cost of the loan from the car dealership to the best deal you could get on a secured (if you can get one) loan.

Cpu2007

Thank you guys, one thing that I didn't say is that I have savings as well.
I could pay 5000k deposit or something and then pay 500£ monthly and once the 0% deal is stopped, I could use the rest of my savings to pay off the cc (as I think by that time I'll have enough money)

But yeah I understand your point as well, it seems rather risky.
Maybe the only safe alternative is to check what financial deal I can get from the dealer?if the interest rate doesn't make the final price too high then it might be worth buying as it would be less headache.

CLAPTON

Cpu2007 wrote: »

Thank you guys, one thing that I didn't say is that I have savings as well.
I could pay 5000k deposit or something and then pay 500£ monthly and once the 0% deal is stopped, I could use the rest of my savings to pay off the cc (as I think by that time I'll have enough money)

But yeah I understand your point as well, it seems rather risky.
Maybe the only safe alternative is to check what financial deal I can get from the dealer?if the interest rate doesn't make the final price too high then it might be worth buying as it would be less headache.

you haven't mentioned you salary or general credit records but maybe your bank would do a better deal;
worth looking round before deciding

Cpu2007

Thank you Clapton, I will look with my bank too.