Buying a car with a house deposit

dimbo61

Most people on here will think you are mad to BUY brand new as the day you drive the car out of the dealers you lose 10/20%
So why not pick up a low mileage 6/9 months old car with a few thousand miles and 2 years+ warranty.
It will be parked in Blackpool so no need for a BMW

Nice low miles Seat Leon 1.2 petrol

http://www.autotrader.co.uk/classified/advert/201607226095312?search-target=usedcars&make=seat&model=leon&year-from=2016&minimum-mileage=from_5000_miles&sort=default&radius=200&page=1&postcode=cw57gq&searchcontext=default&onesearchad=new%2Cnearlynew%2Cused&logcode=p&adPos=3

Nice Low miles 1.6 Diesel Seat Leaon

http://www.autotrader.co.uk/classified/advert/201610018336493?search-target=usedcars&make=seat&model=leon&year-from=2016&minimum-mileage=from_5000_miles&fuel-type=diesel&transmission=automatic&page=1&sort=default&searchcontext=default&postcode=cw57gq&radius=200&onesearchad=new%2Cnearlynew%2Cused&logcode=p&adPos=1

Grenage

I had a corolla second hand, and it went through every mot for 14 years. I'm honestly astounded how readily people will throw vast sums of money on a car.

I know at least two people who complain about not being able to save for a house, but somehow don't question the 300-500 they are shelling out a month on finance and insurance.

glasgowdan

Agree with all above. Spend 5-8k on a car. 20k is silly for a mode of transport. £12k is much better ploughed into the mortgage.

saajan_12

I definitely agree with the 'buy young not new' as with a 1-2 year old car, you still get plenty of warranty and time before things start breaking, but miss the initial hit of 30% depreciation.

Back to your question, it doesn't make a difference:
- BUY IN CASH -> 60k house deposit so need 140k mortgage (70% ltv)
- ADD TO MORTGAGE -> 80k house deposit so need 120k for house + 20k for car = 140k mortgage (70% ltv)
It simply affects where you tell your solicitor to divert funds.

While the interest rate will be lower on the mortgage (secured) vs a bank loan, you're also paying it off over a longer time which will increase the total amount of interest you pay. I would calculate the TOTAL repayments over the full term of a 140k and 120k mortgage, to see how much your car would actually cost you.

seven-day-weekend

We have a 2007 diesel Skoda Roomster, bought four years ago. It had been a motability car, so low mileage and well maintained.

It has never failed an MOT nor had any warnings.

It cost £5k.

Buy a car by all means, but a brand new one is just wasting money, imho.

sheff6107

I bought a 2004 Leon Cupra with 17k on the clock for £4k 3 years ago!

marksoton

Get a job that comes with a company car