£3000 loan...total repayable?

yulrick

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Ok, please bear with me as I've never taken a loan out before...

I want to get a loan out for £3000 for a car. I initially tried my bank via the phone (Lloyds TSB), and was a little taken aback when told that a £3000 loan paid over 3 years would cost me just over £900 in interest, and that was excluding the optional insurance.

I decided that I should google about, and found moneymarket.com.
I gave them a ring, and after spending around 20 minutes giving details, I was told to expect a call in the next 24 hours. SO my question is;
Can I expect to have the quote as from Lloyds?

You may be wondering about my credit rating, well I've never taken a loan out before, never hit an overdraught, never had CCJ's or whatever they're called, never been declared bankrupt, never been in arrears with my monthly rent.

I have a further question;
If for argument sake, I saw a loan from a company online advertising at 8.9% fixed rate, and for 3000 over 3 years, could I expect to pay that, or would my credit rating give them the right to up the rate? Or would they just refuse the loan?


I'm very confused, Thanks in advance!:money:

Phantom_Flan_Flinger

£3000 at 8.9% fixed for 3 years would give you payments of £94.85 per month without any loan protection. Total payable would be £3414.

Part of your problem could be your lack of credit history. It makes it harder for lenders to see how well you pay of your debts.

Loans advertised on sites are always stated as typical, so unfortunately you may not get their best rate.

CLAPTON

A loan of 3000 over three years that cost 900 interest corresponds to about 17.9 % APR

Have you considered saving up the money rather than borrowing?

yulrick

Thanks for replies.
I'm feeling a little bit down at the moment.
I would save up if I could, but this is my situation...
My current car, Peugeot 106 is starting to fail on me, and I know I have maybe a couple of weeks at best to replace it. So I'm desperate to get another car, as it's pretty essential to me.
I couldn't save up enough in time.

You know, I ran my bank a second time, and I was given , for the same conditions (3 years, £3000) a quote of total repayable now proposed at over £4100, over £1100 on interest :mad:
I tried another company, and was turned down, now I'm worried it's having a negative effect on my trying to get a loan.

So right now, out of desperation, I'm thinking of just taking the loan from my bank. I've never so much as missed a payment in my life.

I hate loans.

joanne_musgrave

i have shopped around,and prob. better off getting a newer car over 5 years paying there interest ,usually works out cheaper and you get a newer car that will last longer

[Deleted User]

interest rates on lower amounts(£3000 being a fairly low amount)are often at aprs well into double figures now,over £7.500 with a good record you might get 8.9%.
another alternative would be a cc with 0% intro rate,if you can find/get one

bouncydog1

joanne_musgrave wrote: »

i have shopped around,and prob. better off getting a newer car over 5 years paying there interest ,usually works out cheaper and you get a newer car that will last longer

5 years is a very long time to take out a car loan - general advice given on here is 3 years or less.

OP do you have a credit card or could you obtain one that gives you one year with 0% on purchases - does your bank offer one for instance. At least that way you could pay a reasonable chunk off the borrowings in a year and after about 10 mos look around to see if there was either a low rate life of balance one available or a BT at 0% interest. At least going this route (if possible) you will save on the interest.

I would try your bank first rather than looking around for credit again at the moment if possible as all this is going to do is make your look desperate and lenders will wonder why.

The alternative is to try and nurse your car along for a little longer to give you a bit of breathing space.