Credit Card for my son to purchase 1st car

TheEffect

swindiff wrote: »

What a load of rubbish. Credit is a fact of life and a very useful tool if used correctly. I do agree however that it is a subject that should be taught in schools. Buying an old banger could work out more expensive in the long run through high maintenance and repair costs. I myself lease a car. Ooh that's credit spawn of the devil. Without credit how many people could ever own their own homes. Like anything there is a right way and a wrong way.

Credit is not a 'fact of life', it is a choice. As for using credit card correctly...

swindiff wrote: »

Also if he needs a bit more cash one month then the minimum payment is only 1%

Best of luck to your son. I hope he doesn't fall into the spiral that many, many people do.

swindiff

Do you have a mortgage?

pvt

swindiff wrote: »

Do you have a mortgage?

A mortgage is a very different form of debt to the type you're advocating your son uses:

• Firstly it is secured against an asset of greater value than the loan;
• Secondly, if one did not have a mortgage then one would typically be having to pay out for rent of a similar amount.

Credit (or more correctly, debt) is not a "fact of life" at all. Other than my mortgage, I seem to have managed very well going through life without ever having to get myself into debt. It's very simple really, I only spend money that I have.

I fully accept that there are people who are happy to pay for credit, and, as TheEffect says, that's a choice. But circumstances change, and this forum is all too full of examples of people with tens of thousands of CC debt that's dragging them under.

I echo the advice of others who have advised you that it would be far better for him to save like mad, and then buy a car outright. You would be doing him a greater service teaching him to live within his income rather than introduce him to a life of debt and a culture of spending money before you have it.

swindiff

A mortgage is credit whatever way you look at it so the vast majority of the population who "own" their own home have used credit and are in debt. So for them it is a fact of life. Credit cards if managed properly are not a bad thing in fact they are by far the cheapest form of borrowing. When I bought my house I secured 8k of what I needed on a credit card because I could get it at 0% for 30 months and if I had added it to my mortgage it would have put me over the 75%ltv and therefore a higher interest rate on my mortgage. Using the card saved me hundreds of pounds in interest charges. I never missed a payment and cleared the debt within the 0% introductory period. Just because some people don't manage them properly does not make then inherently bad.

jckh14

swindiff wrote: »

I have a Halifax clarity card so I am going to use that to withdraw the cash required to my Halifax current account.

Could you not buy the car with your credit card? Then you would save on interest from not withdrawing the cash as you'll get until the statement payment due date , it would not go down as a cash advancement on your credit file, plus you would get s75 protection?

swindiff

I would have been charged 2% of the purchase price if I had made the purchase using my credit card. So cheaper to do it this way.