Loans or Savings or Cash Transfer Card

dazanteney4

Hello Everyone,

Me and my OH are looking to purchase a replacement car in the coming weeks or months but i have a question about how to finance this.
The value of the car will be about £5k maybe £5.5k if i find one i really like.
I currently have £4k sat in two x TSB 5% current accounts and the other £1k sat in a Tesco bank current account. Should i use this to finance the car and "pay myself" back so to speak, or take a small loan with Sainsburys etc with a rate 4.2% or should i look at a cash back card? I'm hesitant on the cash back card as my CS is good but i moved my CC in October, id need a pretty large credit limit to get the £5k.
My simple maths looks like the loan might be best to save a little £'s but after the tax on the savings this must be close?
Thanks!

vlad

You will only get the best loan deals on amounts over 7.5k

Stevieleser

I'm in a similar quandary but the other way round, I have an £8000 loan which I want to pay off with a 0% credit card but the transfer fee is 3 or 4%.


Anyway around this?

adindas

Credit card 0% on purchase is definitely the best option. The only problem here is that many car sellers will only accept card purchase if you pay the fee. It is not uncommon they ask about 2-3% fee so other alternatives might be better. So check it with your car sellers first befire you got ahead.
Here is the link for % for purchase card.

http://www.moneysavingexpert.com/credit-cards/best-0-credit-cards

Now, Saving or Loan?? Well it will depend on how much after tax interest you are currently getting in your saving.
If your saving interest is greater than the interest of the loan you will get then Loan is definitely, otherwise saving is better.

The above decision is "purely based on financial decision". You will also need to count other factors such as whether there is a good chance to get that loan and/or the card. Thus credit check, which will have impact on your short term ability to get a better deal in the future. Also whether yo need your money in saving in the near future, etc ...

dazanteney4 wrote: »

Hello Everyone,
Me and my OH are looking to purchase a replacement car in the coming weeks or months but i have a question about how to finance this.
The value of the car will be about £5k maybe £5.5k if i find one i really like.
I currently have £4k sat in two x TSB 5% current accounts and the other £1k sat in a Tesco bank current account. Should i use this to finance the car and "pay myself" back so to speak, or take a small loan with Sainsburys etc with a rate 4.2% or should i look at a cash back card? I'm hesitant on the cash back card as my CS is good but i moved my CC in October, id need a pretty large credit limit to get the £5k.
My simple maths looks like the loan might be best to save a little £'s but after the tax on the savings this must be close?
Thanks!

YorkshireBoy

Stevieleser wrote: »

I'm in a similar quandary but the other way round, I have an £8000 loan which I want to pay off with a 0% credit card but the transfer fee is 3 or 4%.

...or 1.69%

Anyway around this?

Get the 1.69% fee card (with 32 months 0%)...

http://uk.virginmoney.com/virgin/credit-cards/pre-apply/?product=mt-card-02

scoot65

YorkshireBoy wrote: »

...or 1.69%Get the 1.69% fee card (with 32 months 0%)...

http://uk.virginmoney.com/virgin/credit-cards/pre-apply/?product=mt-card-02

I've just gone down the Virgin Money money transfer card route as suggested by YorkshireBoy to borrow £3.5k for a motorcycle.

I got the £3.5K cash into my current bank account and I was given a £9k (including the £3.5k mentioned above) limit on the credit card.

Works out a lot cheaper than a loan……… and it means that I'm not touching any of the cash in my "high interest" accounts!

YorkshireBoy

scoot65 wrote: »

I've just gone down the Virgin Money money transfer card route as suggested by YorkshireBoy to borrow £3.5k for a motorcycle.

I got the £3.5K cash into my current bank account and I was given a £9k (including the £3.5k mentioned above) limit on the credit card.

Works out a lot cheaper than a loan……… and it means that I'm not touching any of the cash in my "high interest" accounts!

Hopefully you had room to stooz the other circa £5K?