Buying my first car.

titfortat40

I'm buying my first used car soon (hopefully) and wondered if I would be better off getting a loan from my bank or use my credit card to finance it?
I don't want to pay more than £2000 for the car, as it will be my first car, so don't want to get into too much debt.

My credit isn't great, but it's not too bad either.

Any advise will be greatly appreciated.

Ultrasonic

The simple answer to your question is that a bank loan will be cheaper than a credit card.

However, there are a number of other things to think about here:

1) Have you considered how much insurance will cost and how you will pay for it? This could be £1,000+ depending on your age. Choice of car will also be a significant factor here.

2) You alse need to be able to budget to pay for repairs and running costs.

3) If at all possible save to buy a car, don't get a loan.

4) Finance provided by the garage/dealsership selling the car is another alternative to a bank loan.

titfortat40

You're right of course, I should have a think about it first. Yes I have considered the cost of running the car, repairs, insurance etc..

I heard that if I get the finance through the the car dealer, it may end in me paying rather more than if I get a loan?

I'll definitely mull it over first though, thanks for your advise.

jay87

A credit card can be cheaper than a loan if you can get a 0% for purchases card. Loans for smaller amounts tend to be over 10% APR so compared to the best credit cards they are more costly,

Whether you can get a 0% purchases card if you have a limited credit history is another matter. May be worth asking mum and dad, or if they can take out the best finance deal for you

I found a trader that didnt charge me a card handling fee as well, so if you can do this all the better

In terms of cheaper insurance i'd say go for something different that the world and his wife havent crashed before,

Have fun picking something :-)

Ultrasonic

jay87 wrote: »

A credit card can be cheaper than a loan if you can get a 0% for purchases card.

Fair point .

GAZ237

titfortat40 wrote: »

You're right of course, I should have a think about it first. Yes I have considered the cost of running the car, repairs, insurance etc..

I heard that if I get the finance through the the car dealer, it may end in me paying rather more than if I get a loan?

I'll definitely mull it over first though, thanks for your advise.

While your mulling it over. Run some dummy quotes for insurance, with the sort of car you are looking for (engine size, year ect) on the comparison sites.

It may be possible that the insurance will cost you a lot more than the car. Even if you pay monthly, it could be £200 a month.