First Job, First Loan... Help needed!

al86

Hi all,

Right, I am after a loan for a new car at the end of this month.
However, I only started this job at the beginning of this month, and this will be my first full time employment - and therefore the first regular income into my bank account with Abbey...

So, what should I do.
Do I apply with Abbey, or do you think I would get turned down after just one monthof income, or should I go for someone else? Nationwide etc etc etc.

I have been with abbey for approx 10 years, maybe more. But until November last year, I had a savings account with them, which I then changed that month to a full current account.
My savings account didnt have any regular income into it, and was rather sporadic, in that I sometimes had £500 in, sometimes £1.
And my current account since Novemeber has been the same, but this month will see my first pay of regular income from my new job.

I am 18 years old and after a loan of £4000.
And just incase your answer are going to be based on income, I will be seeing variable income every month from now on due to comission, but will always be over £1200 paid in, after tax every month.
I am not a homeowner, living with parents.

help much appreciated!!!

jonesMUFCforever

You don't tell us how much the car is going to cost and whether you have any savings to go towards it.
Have you also considered the cost of insurance?
For someone of your age I would be suprised if you got a quote in your name for less than a £1000 - Is this in your budget?
You say that you will be paid on a commission basis with a minumum of £1200 - is this gross or net of tax?
Will you be self employed? and is your salary really guaranteed for ever or only for a number of months whilst you learn the ropes?
Please bear in mind that in my opinion you will not be eligible for protection insurance on any loan for redundancy because I believe that it is standard practise in nearly every organisation for you to undertake a 6 month probationary period before you are actually confirmed as a full time employee.

From the points above you will see that I do not think at present that it is a good idea for you to take out a loan (if you can find one). You will be getting into massive debt even before you get your first pay cheque!
My opinion is save for the first 6 months - ensure that you like the job and they like you and when you are confirmed as a full time employee, apply then for a loan for the car.
Eric

youngandreckless

I'm with ejones999 on this. I have a loan and although I can afford it and am paying it back, it limits your freedom quite alot - ie you can't go travelling or be without work etc. You are in a brill position at the moment as you're just starting out and don't have debt weighing you down,enjoy that feeling. That said, if a loan is definately the way you want to go, make sure the borrowed amount is exactly what you need (or as near to) don't be tempted to borrow any extra. Find a loan which has the lowest APR and start there (you can use this site to find the best deals), you really want to pay as little interest as possible. You may have more luck with your own bank but they may not have the best deal, so shop around first. Good luck with it, be sure you definately want to go down this road as you'll potentially be paying it back for many months. Youngandreckless

burbs_2

Al

Im not going to try and talk you out of the loan idea as that is what you post asking about so obviously you believe you are ready and able to take on the responsibility. I sell cars for a living and if you came into my office you would be a ray of light for me. Young, excited about getting a car, probably looking for small monthly payments and excited about getting your car. Heaven to me - i could sign you up on a huge finance package as you would just go with the flow. This is the way us dealers think.

The thing i would say is be very careful taking out finance this way as if you default you are in big trouble, your car will be gone and you will be left with nothing. If you are sure about a loan then i would approach your bank first, i cant see anyone else giving you a loan at the moment due to your circumstances - your bank may be your only option.

As someone mentioned - check your insurance, many do it in parents name etc but check everything before you commit to a loan.

If you are after a sports car on a dealers finance package come to me..........ha ha. good luck mate

al86

ok, thanks for your replies first off...
but I didn't ask for advice on whether to take a loan out or not.
As I'm sure you and many others do, I have weighed it all up, and looked into it and considered whether i can afford it and still have plenty left over. I have come to the conclusion I can afford a 4k car, insurance is going to be just over 2k for me too on the car I want.
Which I can afford, and dont mind for my frist year to get a years NCB, as after that it drops considerably for me. So it is only for a year.

I did ask for advice on WHO to go with, not whether or not to take a loan out.
So any further replies, i would appreciate it if they kept on topic?

sorry for a bit of a rant, but i have heard "dont do it" so many times now, just after some further advice on LOANS, not whether or not to take one out.

al

jonesMUFCforever

sorry for a bit of a rant, but i have heard "dont do it" so many times now, just after some further advice on LOANS, not whether or not to take one out.

Well if it is not just me advising not to do it - STOP and listen!!!
You didn't answer any of my questions either which suggests to me I've hit the nail on the head.
Eric

daveboy

If I'd just started a new job the last thing I'd be thinking of would be borrowing money. I'd get myself settled in my employment first - a lot of places have a probationary period of up to 12 weeks. They can let you go at any point in that time.

Then where would you be, if that applies to you?

I borrowed money when I moved out of my Mum's house at the age of 20. Only recently have I finally got myself debt free - at times I wondered whether I'd ever pay it off. I felt the pressure of working full time and having no money constantly.

I know how bad it feels and suggest that anyone who is considering borrowing, should seriously look at it carefully. I fell for the 'I must have this and that' phase and that was what caused my problems. Sometimes a car is a neccessity but the amount you pay for one can still be controlled if you take some time and effort with it.

margaretclare

Al86, you go into 'rant' mode because people tell you what you don't want to hear!

Reading the first sentence of your post again, it's so arrogant: 'Right, I am after a loan for a new car...I only started this job at the beginning of this month'. So, first pay-cheque coincidental with first debt.

You're living at home with parents, but I assume you're going to pay something for your keep while you're there? You say you're certain to have £1200 paid into your account every month. That's after tax and NI payments - a very good income for your age. From that I assume you will be paying a quarter of that to your parents against the costs of you living at home? Say £300 a month which is modest - if you tried to rent a flat you'd be looking at much greater costs in rent, fuel bills, council tax, food etc.

Then, once you've got a car, you've got to tax, insure and put petrol into it. Have you worked out the costs of all those things?

Why does it *have* to be a new car bought on a loan? Is it a status thing? Is it too degrading to buy a banger and run it for a year or two until you've got some kind of savings? You can get a much better deal buying a car if you have a deposit to put down, even if you have an old car and can get some kind of part-exchange deal on it. Remember that if you get a new car it's going to lose a lot of its value the minute you drive it off the forecourt, and you'll never get back what you'll be paying out in interest charges.

If I was a car salesperson I'd roll out the red carpet to get you into the showroom! I'd think all my birthdays had come at once if all the punters had your attitude to car-buying. And if I was your Mum there is no way you would insure a car in my name - too big a risk.

Aunty Margaret

burbs_2

I hear what the people on here are saying, they are older, been there done it etc but as the OP said, he has weighed it up and has not just decided this lightly. He believes he can afford it and he knows what he can afford better than anyone on here so i say go for it.

At the end of the day a £4000 loan at 18 years old is not going to be the end of the world for him.

As the poster above states though, car dealers will roll out the red carpet. Im a dealer and i would do just this

margaretclare

burbs wrote:

I hear what the people on here are saying, they are older, been there done it etc but as the OP said, he has weighed it up and has not just decided this lightly. He believes he can afford it and he knows what he can afford better than anyone on here so i say go for it.

At the end of the day a £4000 loan at 18 years old is not going to be the end of the world for him.

As the poster above states though, car dealers will roll out the red carpet. I'm a dealer and I would do just this

I agree. What's the old saying - "a fool and his money are soon parted?"

Aunty Margaret

daveboy

al86 wrote:

However, I only started this job at the beginning of this month,

Here endeth the lesson. You said it yourself. Take your own advice.