Car Finance Or Bank Loan?

VelvetWinner

Thank you all for your replies!

I am thinking of borrowing £2,000, so not alot really.

From what I can see on the loan checker on here, there doesnt seem to be much chance of me getting a loan easily. I mustn't have a very good credit score i'm gussing, although I shouldn't have anything that would make it a bad one?

I would prefer to get a loan over a car finance from what i've researched so far, but I have no idea where to start, obviously I can start by seeing how much payments will be each month etc but i'm a little worried incase I either get regected and cant get another loan and also meaning i'll be left with a bad footprint on my credit score or that i will miss knowing something important but it's too late to change company.

Maybe i'm fussing over nothing, i'm not sure..

ChuckMountain

£2000 is pretty expensive to borrow on a loan and car finance because you normally get stuck for high interest rates.

There are a lot of calculators you can use before you need to enter details so you can see how much the loan amount would cost you before you started. (Comparison sites normally ask for some details)

But as a bad example a quick Google gives Lloyds which to borrow 2k gives an interest rate of 26.7% which over 3 years would be £78.36 a month and £2,820.96.

The same loan at Santander would be £73.22 saving nearly £200 over 3 years.

For me that is a ridiculous amount of interest to pay but I appreciate everybodies circumstances are different.

The same loan calc at Lloyds drops to 3.9% at £7,500.

Have you thought about other methods, borrowing from family etc.

pjcox2005

How urgently do you need the car, can you get a 0% credit card and use that for daily expenses - food shop etc, and save the cash you would have spent to buy the car. That way you should have lower interest costs but it depends on how quickly you'd be able to pay off the £2k loan i.e. within 2 years etc if that's the interest free period.

NineDeuce

Just get a cheapo car to avoid interest....