loan/car finance but very bad credit rating

amyc92

Basically I need a new car as mine is slowly dying on me and I drive 70 miles a day.

My credit rating is 'Very Poor' around 270.

However I cannot afford to buy a car outright. Is there any companies that offer car loans but with not HUGE apr's

Would having a guarantor be of any use to me?

TIA

DCFC79

amyc92 wrote: »

My credit rating is 'Very Poor' around 270.

The 270 doesn't exist as the lenders don't see it, its a figure given by the CRA's.

amyc92 wrote: »

However I cannot afford to buy a car outright. Is there any companies that offer car loans but with not HUGE apr's

If all thats available are loans with high apr's then thats all thats the best on offer.

amyc92 wrote: »

Would having a guarantor be of any use to me?

Do you know what beng a guarantor entails ?

If you stop paying the loan then the guarantor is asked to pay up, dont put nyine in that position. Might be cheaper for them to take out a loan and you repay them back.

What monthly payments can you afford ?

Tixy

Even if you use a loan company/finance company that requires a guarantor the interest rates are usually still very high.

What negatives are on your credit file (not the score, what actually shows on the basic report).
How much were you hoping to spend on a new car? how much is your current car worth and how much are you able to afford to repay a month?

What would you consider to be a huge APR?

amyc92

My dad said he would be guarantor on my brothers car so I think he would do that for me, but I suppose asking him to take out the loan might be better.

I can afford max £150 a month for the car.

I had a default of £19 but I have settled that, I think the negatives are that I have only been on the electoral role for 1 year and I have had a few too many searches in a short period of time.

amyc92

I was wanting £6000

Tixy

That is a very large sum compared to how much you can afford to repay a month. That would likely take you 5years to repay, even at a half decent APR.

You should be able to get a car for a lot less than that, that will last you a few years, even with a reasonbly long commute.

If your father is willing/able to take out a loan in is name for you then maybe you could look at cars for around £1000 which you could afford to repay him within a few months and not cost you a crazy amount in interest. You could then start saving the £150 a month for a couple of years to put towards a more expensive car once you can afford it and by that time hopefully your credit file will be in a much better shape.

amyc92

That does sound a good idea Tixy, but I wanted something more reliable and cheap on fuel as I am spending a lot on fuel at the moment. Thats why I wanted a newer Ford Fiesta as its nearly double the MPG that mine is now.

F1F93

amyc92 wrote: »

That does sound a good idea Tixy, but I wanted something more reliable and cheap on fuel as I am spending a lot on fuel at the moment. Thats why I wanted a newer Ford Fiesta as its nearly double the MPG that mine is now.

If you're going at this from a purely money-saving point of view, forget the Fiesta. There are much cheaper cars out there. For example, the Hyundai i10. You might still be able to get an old generation (but still brand new) one for about £6k. Of course it won't be anything nice, and you won't get any gadgets, but it'll be cheap, reliable and get good mpg. Get the smallest car in the range, they're usually the most efficient. (e.g the Ka instead of the fiesta).

What car have you got at the moment? (Include milage, age, condition etc) as if you part ex you'll get a bit back.

CreditCrunchie

Why do you want a car that would require finance? Just but second hand. You can get plenty of good cars under £2,000 on ebay and preloved.

Fiesta's are great btw. I have a battered old Ghia from 1998 and she's still going strong, and cheap as chips!

Herzlos

Forget a new car for saving money, it won't work.

Assuming you're doing about 1400 miles/month (70/day * 20) and fuel is ~£6.31/gallon (4.54l * 1.39/l).

Then if you get:

30mpg = £293, 40mpg = £202, 60mpg = £146 and 80mpg = £97.

So that means if you currently get 30mpg and get a new car that actually does 60mpg, you save £147/month, and going from 40-80mpg you'd save £105/month. Less than you're intending to pay for the new car.

You're unlikely to see as much as 80mpg in any £6k car, so from a pure MSE point of view you aren't doing enough miles to justify getting huge rate finance for a new car.

I'd be looking at something small engined for about £1000, and put the rest of the money aside, then in 2 years you can get something newer with the money you've saved.

RuthnJasper

I got a cracking little Vauxhall Corsa last year from Auto Trader online for £1,100. Really economical to run, lower tax bracket, etc.

I did look at some Ford Fiestas/Kas of similar vintage (around 10 years old) as well, but the rust on them was appalling.

Best wishes. x