Could I get a loan?

Katie815

Hi, any advice would be greatly appreciated.
In a bit of a dilemma, my car has broke and I need a new one to get to work (60 mile round trip a day) however I don't have the available funds to do this outright. I applied for car finance around 10 months ago and got refused. I have credit card debt at around £4000, Live at home with parents and earn £22,231 a year. On Experian it says my credit score is 965 and excellent, however it said that when I applied for car finance last time and got refused so don't really trust it.

So now my question is should I attempt car finance again? look at leasing a car or apply for a loan at around £10000 and pay off my credit cards with that and get a decent car? I feel like I only have one shot at applying as any refusal would stop me getting the others.

Thanks for any help.

TadleyBaggie

Probably cheaper/easier to get the car repaired, what's the problem with it.

somethingcorporate

Living at home on £22k a year, have you got any savings to put towards this car?

You can get something reasonable for £2k.

Working full time and living at home is as best financially you are ever likely to get, yet you have a deal of credit and want to get a bunch more. I think you need to look at your financial priorities.

DCFC79

Not what you want to hear but you live at home, earn 22k, surely you should have alot of savings just for this purpose.

Katie815

I've only just started earning that literally in the last 2 months, before that it was a lot less. The credit card debt was accrued because both my parents got made redundant at the same time a couple of years a go and i helped them with the mortgage, they're still not really in a position financially to help out though they would if they could. To get the car fixed is going to be around £400-500 it's the timing chain. Not really sure the car is worth that much. It's a 55 reg corsa. Thanks for the replies.

[Deleted User]

Katie815 wrote: »

To get the car fixed is going to be around £400-500 it's the timing chain.

That's a lot cheaper than a new car.

foxwales

I wouldn't consider finance again if I were you. I would consider a personal loan.

You are more likely to get a personal loan, however, it maybe higher than the advertised interest rate. By purchasing the car using a personal loan, should your income drop, you don't have any liabilities to a finance company whom could repossess the car if you are unable to maintain repayment, where as with a personal loan, they would have to consider making you bankrupt in order to force you to sell assets.

bargainbetty

You already have £4k in car debt. Add your £10k request to that and you are over 50% of your income, which is a benchmark that lots of people will tell you lenders use to judge affordability.

Lower your expectations. You can get a good car for a lot less, or just have this one repaired and save up.

Ebe_Scrooge

Katie815 wrote: »

To get the car fixed is going to be around £400-500 it's the timing chain. Not really sure the car is worth that much.

As others have said, what the car is "worth" is largely irrelevant in your situation - £500 on repairs is a lot cheaper than a new car, as long as the rest of the car is basically sound. You really don't want to be taking on more debt.

And, as is said on these forums time and time again, your credit "score" is meaningless. What counts is the amount of existing debt you have in relation to your income. Also any "potential" debt is taken into account - for instance, if you have a credit card with a £2000 limit ( even though it may have a zero balance at the moment ), lenders will always assume a worst case scenario, and assume you're going to put £2000 on that card.

As a previous poster said, a rough-and-ready rule of thumb is that no-one will lend you more than 50% of your income, maximum. If you're already close to this figure, and the loan you're applying for will take you over it, then you have very little chance of being accepted.

Foxy-Stoat_3

Apply for £7K and buy a £3K car, clear your credit card and CANCEL or reduce the limit to £500 or you will be in deeper than you can afford.

DCFC79

If you do go for a loan with the intention of paying of the card debt then pay them off and dont spend it on things you dont need otherwise you will be in the same position but with loan repayments.