Second hand car - bank loan vs dealer HP finance?

yenool

I want to spend about £6500 - £7000 on a 'new' second hand car. The plan is to keep the car for at least 4-5 years.

Sainsburys bank have offered me a loan at 4.9% APR over 4 years which works out affordable.

But now I am wondering if I get more protection or a better deal by getting dealer HP finance. The dealer uses the likes of Motonovo, Close motor finance, Evolution funding, etc.

I haven't asked for a quote but the 'typical' example on their website looks a bit more expensive than a bank loan and obviously on HP I wouldn't 'own' the car until the final payment.

But my understanding is I would be able to hand it back half way through the agreement if necessary. This sounds like a potentially important contingency?

Also I am wondering if buying on Finance gives me more consumer protection if the car turned out to be a 'lemon'?

Foxy-Stoat_3

Get a bank loan and buy from a private seller who has looked after the car, preferabley for a good few years. Try and get a 1 or 2 owner car with lowish mileage.

Look at other recent threads on here and see some of the situations people get themselves in when they rush out and buy an overpriced car on over inflated finance package.

Obviously you only hear when it goes bad, and I am sure there are hundreds of happy car buyers driving their "new" cars on HP so research your chosen car well and look at all options.

What are you looking at buying?

burlington6

Don't buy off a private seller. There are far more dishonest private people than there are dealers. Buy off a local company with a good reputation. You will pay a little more but you'll get far more protection.

yenool

I'm not too concerned about where to buy (private/dealer). A HPI check will make sure it isn't stolen, written off or with outstanding finance. If I buy privately I would aim to spend 10% less so I had some money for any necessary repairs.

A good trader would be preferable as the car should come fully serviced, MOT and ready to go. But the area I live in is full of dodgy dealers and I've had a couple of bad experiences before...... so there are no guarantees.


I don't know exactly what I want yet. I need a SUV type of vehicle.

Foxy-Stoat_3

yenool wrote: »

I don't know exactly what I want yet. I need a SUV type of vehicle.

I bought a RX300 with less than 48,000 miles from a couple of months ago, horrible on fuel but my partner only does a few miles a week in it. Loverly to drive.

When I was looking at motor dealers, the prices for a 130,000 mile ones were the same as the one I bought with 80,000 mile less from a private seller. Always helps to research and look for a good 3/4 weeks before buying, you will be able to tell if the cars your interested in are well priced, been for sale for weeks on end with no buyers and any that pop up cheap.

jimjames

burlington6 wrote: »

Don't buy off a private seller. There are far more dishonest private people than there are dealers. Buy off a local company with a good reputation. You will pay a little more but you'll get far more protection.

Totally disagree.

There are very easy way to spot the dodgy sellers so just avoid them.

Follow the advice above buying a 1 or 2 owner well maintained car - FROM the owner - and you should have a vehicle that will keep you going. Just avoid the ones who are trading or have only owned the car for a matter of weeks.

burlington6

The Great British Public are far more dishonest than any dealer. Watch yourself.

yenool

Foxy-Stoat wrote: »

I bought a RX300 with less than 48,000 miles from a couple of months ago, horrible on fuel but my partner only does a few miles a week in it. Loverly to drive.

When I was looking at motor dealers, the prices for a 130,000 mile ones were the same as the one I bought with 80,000 mile less from a private seller. Always helps to research and look for a good 3/4 weeks before buying, you will be able to tell if the cars your interested in are well priced, been for sale for weeks on end with no buyers and any that pop up cheap.

Can I ask how much you paid ? That is the type of think I'm after, although I have been looking at Jeeps so far. I don't do high mileage so I'm not too worried about fuel consumption, but I want to avoid the £500 tax band.

Foxy-Stoat_3

£5.5k for a 53 reg (private plate on it and noone is any the wiser), black leather, reversing camera, sat nav with full history. I had the cam belt replaced, they are good for 100K miles or 10 years, but the belt looked in very good order when it was removed. I was told to drive it until it broke, which would of been years as its a very wide belt, engine is non-interferance, but got it done anyway as I wanted everything to be as trouble free as possible.

Buy one thats older than March '06 and your into £300 a year. If your buying a 400h (hybrid and slightly cheaper tax) then spend a lot more money on the best one you can find. History and number of owners seems to be the key.

You won't be able to get a RX350 (3.5 2gr engined) in the £300 tax band. 70 odd hp more grin.

Buy a Gen2, nicer shape and better gearboxes, they are not made of chocolate unlike the Gen1's.

I bought a SE-L ( air suspension & reversing camera as standard) you will want to avoid that one if your looking at buying a medium - higher mileage but even on a lower mileage one I expect to roll the dice and take my chances. My prefered one was SE with the sat nav and camera with black or grey leather, beige is not very nice. Not many of them around. This one came up and it had the lowest mileage advertised at the time.

I kept watching a lot on the ebay, mainly at dealers, for weeks and the same ones kept coming up either meaning that they were overpriced or something was up with them, a lot of them were 110K + miles but I wouldnt be put off if the price and servicing was right.

Get on the Lexus RX owners forum for more information, or rather the normal problems which to be honest, there isn't many terminal ones. Dearest one aside from air suspension is error 4 on the cd player. Everything else with these are generally good....apart from the low 20's mpg but if your not doing the miles is a small price to pay for wafting alone in what someone else who has driven these for years as a powerful cloud !!!

If you need any pointers let me know.

http://www.ebay.co.uk/itm/Lexus-RX-300-SE-L-/191519314280?pt=LH_DefaultDomain_3&hash=item2c9770d168

^^^^^ This is pretty much what I bought, apart from it had black leather and it was silver. As you can see, the dealer wants just under £8K with more miles than mine.

http://www.ebay.co.uk/itm/Lexus-RX-400h-3-3-SE-5dr-4WD-Sat-Nav-3Keys-1-Pervious-Owner-Lexus-Services-/221747881597?pt=LH_DefaultDomain_3&hash=item33a134267d

^^^^^^ Is what I would buy if I had more money to spend on a RX400h, private seller so you shuld be able to knock him down to well under £8k