Using credit card to pay deposit for new car

Martyn_H

Hi

I intend paying at least £100 deposit by credit card on a new car.

Is there any value in doing so?

Thx

forgotmyname

Depends on the cars age and value and the dealership. If the cars a lemon it may give you another avenue for getting a fair deal.

Weird_Nev

It's absolutely worth while putting at least £100 on a Credit card. UNder Sec 75 of the Consumer credit act, it makes your credit card company jointly liable with the vendor of the car for it's quality and fitness for purpose. It's about the best protection against buying a total lemon you can get - still not foolproof, but far better than going it alone after a cash purchase.

poppasmurf_bewdley

I put down a £500 deposit by credit card on my present car just for the said protection.

Fortunately, I never needed it.

It's something I would always do in the future, just in case.

INT1

Just be weary that it then doesn't get 'refunded' in the cars cost price if then you finance the rest.

Martyn_H

Thanks for the advice. It will be a new car but I'd like to protect myself in the event that the dealer goes bust or I buy a lemon.

YorkshireBoy

Weird_Nev wrote: »

It's absolutely worth while putting at least £100 on a Credit card.

Why "at least £100"? You can pay £1 (or even less if they'll take it) and still enjoy section 75 protection on the entire purchase cost.


Remember, it's the price of the goods or service that needs to be over £100 (and less than £30,000), not the value of the deposit.

Martyn_H

Hmm, I wasn't aware of that.

Weird_Nev

YorkshireBoy wrote: »

Why "at least £100"? You can pay £1 (or even less if they'll take it) and still enjoy section 75 protection on the entire purchase cost.


Remember, it's the price of the goods or service that needs to be over £100 (and less than £30,000), not the value of the deposit.

I was under the impression that it had to be an amount of substance in relation to the purchase, and £100 had been arrived at as a sensible amount. Cheers for clearing that up.

However, I'd still put the WHOLE deposit on credit card, for a number of reasons. Convenience for one, cashback for another, deferred payment for a third and a chance of getting it back if it all goes wrong for finishers.

LandyAndy

If you pay a substantial amount on a credit card the dealer will probably want to charge you an extra 2% or so to cover the merchant fee.

aabs

I notice a lot of cars on dealer forecourts have stocking loans against them which are paid off once the car has been sold.
This is a common practice even with large main dealers.

BUT what if the dealer went bust just after you collected your car.

Would paying the deposit on credit card cover you for this as the hpi Company may have an interest in your vehicle.

Running HPI checks on most forecourts show how common this is but how can you protect yourself ?

Putting a deposit down and then asking the dealer to pay off the finance before you collect can take a while to be updated on the HPI record so that's still not perfect