Quick question…loan vs finance...

lightningrod123

Hi guys quick question……

I'm buying a new car, the apr was 8.8% resulting in £299 per month for £13500 over 60.

I've signed up and picking the car up on Wednesday.

I noticed the likes of santander/sainsburys offering loans 4 ish % apr meaning £250 per month. I have a perfect credit rating/home owner/good income so was considering applying and paying off the finance while still in the 'cooling off' stage.

Would this be accepted considering I've just been accepted this week for the finance? Would it be bad for my rating to apply?

Should have done my homework better!

Thanks in advance.

[Deleted User]

I suppose you now have 13,500 of extra debt and would be looking for another 13.5k of debt,so possibly no

ProudDad

Firstly welcome newbie (was there not that long ago myself)

I would never say never, do you know what your credit file is like? Is it quite good? Reason I am asking is a lot of these places will want it to be crystal clear for those applying for non franchise lending. Who do you bank with have you asked them what they could offer? Reason I ask this is your bank will have the best picture of your finances so most likely(not always) to accept you.

When applying for new loan apply for it as refinance with intention of refinancing existing debt as that's what you would be doing and don't include your new car finance payments in any affordability as you would be paying that off.

Be careful though not to apply for too many loans at once as a lot of these companies don't always offer instant decisions and too many applications can look like desperation when someone is looking at your credit file.

Or you could keep it as is and take this as a lesson for next time?

Hope this helps

ProudDad :-)

TadleyBaggie

Pretty sure the APR is closer to 12% based on the monthly figures, is PPI included?

andyfromotley

Holy cow,

you are asking of you should try to do something that will save you in the region of £3000 over the next five years??
Of course you should!! Dont worry about your credit 'score' one extra chck wont make much difference to it and it doesnt matter as its a meaningless number seen only by you! But it wont really dink your credit history either. But even if it did would you be prepared to pay £3000 to maintain one? No, i wouldnt either.

£3000 is a very expensive lesson to learn unless you manage to shift this. Dont hang around either, get moving before your credit cooling off period expires.

lightningrod123

Cheers guys, applied sainsburys and was accepted straight away so I'll be in time for the cooling off.

Thanks for the advice, i'll be more careful in the future.