Credit Card for my son to purchase 1st car

swindiff

My son was 19 in March and is about a month or so away from taking his driving test. He is employed as a framer and earns £10,200 per year. He has been in the job for about 9 months, before that was in full time education and had 1 year as an apprentice for a Pro hockey team.

We are now looking to finance his first car. Nothing flash, between £1500 and £2000. By far the cheapest way of doing this would be with a zero % credit card. I have used the eligibility check on the MSE website and he is coming up with a 60% chance of being offered a card with

Halifax 0% for up to 21 months
Lloyds 0% for up to 19 months
Bank of Scotland for up to 19 months

He is on the electoral register, has never defaulted on anything, but has no credit history with regards to borrowing. He banks with Lloyds

Any recommendations on success rate between these 3. The longer rate of Halifax would be preferred, but would he be more likely to be accepted by Lloyds as he banks with them?

Also would anyone have any idea what limit he would likely be offered if accepted.

Cheers

Aquamania

swindiff wrote: »

My son was 19 in March and is about a month or so away from taking his driving test. He is employed as a framer and earns £10,200 per year. He has been in the job for about 9 months, before that was in full time education and had 1 year as an apprentice for a Pro hockey team.

We are now looking to finance his first car. Nothing flash, between £1500 and £2000. By far the cheapest way of doing this would be with a zero % credit card. I have used the eligibility check on the MSE website and he is coming up with a 60% chance of being offered a card with

Halifax 0% for up to 21 months
Lloyds 0% for up to 19 months
Bank of Scotland for up to 19 months

He is on the electoral register, has never defaulted on anything, but has no credit history with regards to borrowing. He banks with Lloyds

Any recommendations on success rate between these 3. The longer rate of Halifax would be preferred, but would he be more likely to be accepted by Lloyds as he banks with them?

Also would anyone have any idea what limit he would likely be offered if accepted.

Cheers

As he already banks with Lloyds, I'd suggest try Lloyds first.

Enquire in branch as they appear to have different deals/acceptance criteria to those available online/by post.

Based on the info given, expect the initial credit limit (if accepted) to be £250 (possibly up to £500)

swindiff

Ah if the credit limit is that low that sort of scuppers this plan

Aquamania

Still worth enquiring - they will then tell him what other possibilties are open to him.

DesG

Still worth applying, it will get him a credit history started.


Does the place you are buying the car accept credit cards?

swindiff

Yes, they charge 2% for CC purchases. They also offer finance, £1500 over 2 years is 30% APR, hence me wanting to do it this way lol

19lottie82

How will be finance the insurance? Chances are you'll be looking at another 1.5-2k for that. And fuel, and maintenance, and tax?

Unless you're in a position to help him out (which I'm guessing you're not), then I don't think he can afford a car, given his low salary.

What other outgoings does he have? Does have any savings?

shane1104

Don't know if this helps, but when i applied for my Santander C/Card (NOT the 123) they said its a 100% acceptance rate, and the variables are the limit/interest. with a minimum limit of £500 and maximum of whatever they go up too.
i got declined by Lloyds (my own bank, who offered me the card!!) so the lady in branch said to try santander (nice of her) and i got approved with a £2k limit

swindiff

His insurance will be about £150/month, CC payment could be anything from the minimum of £15/month to around £80/month to pay it all off within the introductory period. If it was not all paid off he would switch it. Tax is around £10/month

Therefore insurance tax and CC could be kept to around £200/month, after the 1st year the insurance should reduce allowing a greater proportion of this to be used for the CC, he pays £200/month keep. This leaves him £450/month to do what he wants with. I think that's perfectly reasonable.

I am in a position to help him, in fact I am doing so by posting here. I could buy the car and give it to him if I wanted to. But I want him to be able to do this for himself, I want him to be able to budget, be responsible with money and learn its value just like I had to when I was his age. Far too many are just handed everything on a plate these days.

swindiff

Thanks Shane, do you mind me asking your age and if your salary was a lot greater than my sons

shane1104

im 27, and I earn £15k a year