Loan for 19yr old Student

alext_3

Hi all,

I'm currently looking for a loan to fund a car which will be my form of transport for getting me to and from Uni this September onwards. I decided against living at Uni since it was only a 15min drive away and would have cost me £75 a week
to do so, which meant it would actually be a lot cheaper for me to just get a new car and travel everyday (my current car is very much on its last legs and was given to me free a year ago - can't complain)...

I have a part time job which earns me £300 a month, and as i'm living with my parents the only real outgoings i have had have been from my car insurance for the past 12 months which has been £75 a month. As my parents qualify in the low income band on income assesment for my student support, i'll be getting a good amount of support throughout my time at Uni. I think my tuition fees will be paid for, and i'll be getting a non-repayable grant which is upto £2750 a year. On top of that, if i need a student loan at any time i can obviously apply for one (i thought of getting one for my insurance and paying it off all in one)... So basically, although my basic income of £300 a month from my job is quite a low amount, it keeps me comfortable financially and with the extras i'm going to be getting as of next month i should be trouble free in terms of repaying a loan.

I am looking at getting a £4500 loan over 5 years and obviously want the interest to be as low as possible. The problem i seem to be having is that, after doing a search on travelsupermarket, it says my credit rating is "needs improvement", which confused me a bit - although i can understand it may be based on my age and the fact that i'm living with my parents. With that aside, however, i do have a regular income which would cover the repayments (even on its own, without the student support which i'll be getting), and i've never had any sort of financial trouble in the few years that i've had bank accounts and debit cards etc.

I've just set up my Halifax Student Account after looking on here at which are the best options, too, which as you may know can give upto £2750 interest free overdraft if necessary (i don't plan on getting anywhere near that!!)... As of this week the Halifax Student Account will be my main one as i'll be leaving my current Lloyds TSB account.

Any advice is appreciated, i think my option of going for a loan is better than financing a car through a dealer as the APR is often very high, although i haven't actually enquired yet due to being advised that a personal loan was a better option. I want to get it all sorted within the next 2 weeks because i would rather not be worrying about methods of transport etc come 17th September when my course starts.

Thanks for taking your time to read this!

Rikki

Just thought you may need to check this:-
Tuition fees have to be paid for either by a tuition fee loan, which you should have applied for by now, or by yourself.

Idiophreak

Personally, I'd try an spend a lot less than that on a car - £2k should easily get you something good enough to last a 3 year course...

I'm taking it that public transport isn't an option for uni?

Finally, if you can, take the student loan for it...you won't get lower interest.
(also, possibly consider taking the loan each year and chucking it in an isa...)

If you want a different sort of loan, I'd reconsider taking it over 5 years - the repayments on £4500 should be quite managable for most people over 3 years (max) and will save you a couple of hundred quid in interest.

Rikki

Idiophreak wrote: »

Personally, I'd try an spend a lot less than that on a car - £2k should easily get you something good enough to last a 3 year course...

I'm taking it that public transport isn't an option for uni?

Finally, if you can, take the student loan for it...you won't get lower interest.
(also, possibly consider taking the loan each year and chucking it in an isa...)

If you want a different sort of loan, I'd reconsider taking it over 5 years - the repayments on £4500 should be quite managable for most people over 3 years (max) and will save you a couple of hundred quid in interest.

Student tuition fee loans are paid direct to the university.

alext may not be entitled to a maintenence loan (which is paid direct to the student) as he is living at home.

Idiophreak

Should be able to get a regular student loan, esp if their parents are low income...?

alext_3

Rikki wrote: »

Student tuition fee loans are paid direct to the university.

alext may not be entitled to a maintenence loan (which is paid direct to the student) as he is living at home.

i am entitled to a maintence loan, its just a bit less if you're living at home...

CLAPTON

This car seems very much a want and certainly not a need.

- firstly consider keeping the current car going; why do you say its on its last legs, has it failed the MOT? what will is cost to get another year or two out of it?

- if it really does need replacing then think 500 - 1000 for a reliable cheap car and not 4.5k

- although you may get a maintenance grant and some top up for the course fees; everyone has to pay the course fees so you may need to take out a loan for them.
If you need the course fee loan, you should have already applied for this. You need to look into this urgently as most UNI's won't allow you to register until the fees are paid.

- you can also get a maintenance loan which cost 4.8% interest for this acedemic year.

- if you really want to get a loan for a car this is by far the cheapest option.

jenni1188

Now i go to uni part time, want a newer car as mine is costing alot and i have been advised by a mechanic to get rid in the next 12 months as it is k reg, hitting 100,000 and has started to have a little problem but not too bad at the moment seeing as it only cost £70 at MOT.

I work in full time employment and am 19, i travel to and from work which is only 7 mile about 20 minutes drive, and i travel a 24 mile round trip to university once a week at least. I have to go to site with work and sometimes this may be travelling to London but up to know i have been able to ask for lifts down there as i do not feel safe with my car to travel 300 miles.

I earn £1000 a month live with parents and my uni is all paid for by my company, i have just recieved £1000 bonus which is approx every 6 months we get one.

I want a loan for a car over 3 years for £3000 as i feel i would get an amazing good quality car which will last me the years however i do intend to save my bonuses and pay it off after two. For now though i would prefere a loan as my bonus has gone into a savings account and is sat there for anything unexpected to occur i have spare money to help.

Why on earth do you need a £4500 car, remeber you have to insure it and you could get a nice little newish corsa etc for £1500 which would last you. Your a student my excuse is long business miles and the fact that i earn plenty in my wage and would be able to save as well as spend on a loan.

Also if you was to get a smaller loan you would have smaller payments, less paid back and a shorter term, if you need this newer car go into your 2500 overdraft and pay into that monthly if its interest free!

No offence but university student full time are usually in about 3 days a week so why do you need such an expensive car for 15 minutes drive! I know you probably have your heart set on the car you want and dont see the point in etting something your not happy with but your already in debt with university so do you really want this as well. In 3 years when you graduate, you will be worth more than your car (you think) and be still paying it off.

I have a K reg corsa, £500 to insure £15 petrol and have had it 2 years. i paid £500 for it. so if that can give me happy trouble free motoring for 2 years why cant a £1500 car not do three years! mine is having trouble now but it was a bargain with full service history!

You seriousley need to think about it or wait till car died then worry!

C_Ronaldo

could you not walk to uni or get the bus or even catch a lift with one of your fellow students

alext_3

Idiophreak wrote: »

Personally, I'd try an spend a lot less than that on a car - £2k should easily get you something good enough to last a 3 year course...

I'm taking it that public transport isn't an option for uni?

Finally, if you can, take the student loan for it...you won't get lower interest.
(also, possibly consider taking the loan each year and chucking it in an isa...)

If you want a different sort of loan, I'd reconsider taking it over 5 years - the repayments on £4500 should be quite managable for most people over 3 years (max) and will save you a couple of hundred quid in interest.

i think you've got a good point mate in the 3 year thing - i did actually think about it, it was just a matter of how much it'd end up costing. I'll look into it.

As for the loan into an ISA thing i have also considered that - the only thing i think i'm gonna use my student loan on is to pay off the car insurance. I have just got a 12 month 0% Halifax Credit Card which i'll use to pay off the insurance and then i'll just pay off the card with the student finance i get.

As for the amount i'm looking at spending on a car - you're right, it could be less. My only worry (and its a big one) is that spending 2k on a car certainly doesn't guarantee its gonna be problem free - i know this because at least 3 of my mates have done similar things and 2 of them in particular i know have spent hundreds within a year on problems that occur. If i spend a little bit more, i will hopefully have more chance of avioding such a thing. My current car i've spent at least £600 on it in the course of the past 12 months, which isn't bad for a years motoring but my car only had 53,000 miles on the clock when i got it, which is definitely what i'd be looking at (or more) for a car costing 1-2k.

I've been to a citroen dealer and looked at a car they have for 4.5k, its got low mileage, a citroen warranty and its a very nice looking car. Obviously i'm not spending the money just because i want a car that looks better, but if i'm going to be shelling out 2-3-4 thousand on a car i do want it to be as smart as possible! With a warranty if i get one from a proper dealer too, it'll be more peace of mind for me. Also, i will try haggling when i go to buy a car and try to get it for as cheap as possible!

jay78

Plus 4.5k over 5 years is very expensive.