Buying a car with a house deposit

Johndbb999

Hi all,

First post!

I'm curious. I recently sold my house in Essex and moved to Blackpool where I'm renting whilst looking for a suitable home.

I am also considering buying a new car as I'll be doing lots of miles commuting now

I have about £80k and houses up north are cheaper than south, so I can get a 3-4 bed semi for anything between £150-200k

My question is, is it better to buy a car using about £20k of my deposit and use £60k in buying a house (I could still get on a 70% ltv on a £200k home or a 60% ltv on a £150k home) or to use the whole £80k as a house deposit and add £20k to the mortgage loan

All advice greatly appreciated!

John

Johndbb999

I might add. I want to manage my cash flow as well and a loan on a car for 20k is in the few hundreds a month mark, a 60-70% loan on a 150-200k house is only a few hundred a month itself so I'm thinking if I can either bundle the car into the mortgage or just buy it cash I'd be better off month to Month

Guest101

I guess my main question would be, do u need a 20k car?

Plenty 4/5k cars that'll last many years.

I just bought one, 2009, but only 20k on the clock

Cornucopia

The best option is to buy the car using mortgage funds if you can, but to pay off the car element with normal car-sized repayments, if you can. Otherwise what looks like cheap credit now will end up costing more than car finance in the long term.

theartfullodger

Blow the lot on sex, drugs 'n rock 'n roll...

When the money runs out apply for benefits: Come back and ask us what "deprivation of capital means" then...

Johndbb999

Thanks cornucopia. I was thinking I could overpay somewhat to make up for it if I bought the car with some of that cash. The payments are a lot less than I'll be used to so wouldn't be too much of a stretch. Mortgage as above in Blackpool is about £400-500 a month when in Essex I was paying £900..

id sooner get a new car because I don't want to mess about with mot worries and The like. I'm spending almost as much time in the car as I do at work so I would like something comfy and hassle fre!

bigfreddiel

You do not need a new car. Besides all new cars look the same these days!

Spend £5k on a good used car.

A friend of mine bought ex-fleet high mileage two or three year cars. All the mileage was mainly motorway, cruising at 70ish, well maintained, it's a no brainer

Cheers fj

Guest101

Johndbb999 wrote: »

Thanks cornucopia. I was thinking I could overpay somewhat to make up for it if I bought the car with some of that cash. The payments are a lot less than I'll be used to so wouldn't be too much of a stretch. Mortgage as above in Blackpool is about £400-500 a month when in Essex I was paying £900..

id sooner get a new car because I don't want to mess about with mot worries and The like. I'm spending almost as much time in the car as I do at work so I would like something comfy and hassle fre!

Sorry, MOT Hassle? It's one morning or afternoon a year.

If you buy new, in 3 years you'll need to have MOTs anyway and your 20k car will be worth 10k? 8 maybe? Maybe even less given the amount of miles.

Anyway it's up to you obviously but this being MSE, I can't think why you'd throw thousands away

jimmy_cricket

Guest101 wrote: »

Sorry, MOT Hassle? It's one morning or afternoon a year.

If you buy new, in 3 years you'll need to have MOTs anyway and your 20k car will be worth 10k? 8 maybe? Maybe even less given the amount of miles.

Anyway it's up to you obviously but this being MSE, I can't think why you'd throw thousands away

Agree. My eight year old car has sailed through every mot with no advisories. Mind, I did buy it nearly new and have looked after it

dgtazzman

Bought a near top of the range 3 year old Insignia for just over 7k a few months ago. They were selling it cheap as it had 96k on the clock, but as a diesel, that doesn't bother me. Had full service history and was well maintained as a fleet car, so the engine will last at least another 200k. Buying the same car new would have come close to 30 grand. In other words, buy youngish used, don't by new, burning bank notes to light your cigar/cigarette has a similar effect to buying a brand new car...

dinkylink

Even if you bought it at a year old you could still save something ridiculous like 30% and have at least 2 years of the warranty left.

My tactic is to buy at 3 years old for less than 50% of new price and run it into the ground. Still lots of life left in a car at that age and most of the depreciation is done which is the biggest cost of having a car.