how to fund a new car - cash, card or PCP

Opalset

Not sure how to fund the purchase of my new car. Car will cost £40K
I can get the £30k cash and pay cash but that will empty all my "emergency" and saving accounts
I have several credit cards with no debt on them and the available balance on all the cards comes to £35K. I could max out each card and then balance transfer the lot? is this possible?
get a loan but best rate seems 6.9% over 5 years
or is PCP (is that what its called) for the car

Any advice welcome on the way forward would be appreciated

foxy-stoat

Use money transfer £5K and use your cash savings if you must spend £40K on a car.

Use the remaining credit cards as your "emergency" fund as and when. Build up your savings again with whatever you were planning on spending on the monthly repayments if you did get a loan.

YKNA

Best way to do is something called lease purchase on a fixed two year term normally 3+23 months package.
The trick here is not give the car back at the end of the term or pay balloon instead sell the car, settle finance and keep the equity.

Type in lease deal over 24 month on the car you want and use a broker they get best rates and them take them offers to the dealer and say match it.

dealers dont like doing it as it trims there profits and if you want pay of the two year term so you have no liability and them invest the rest of the money in something like buying crypto or buying stocks or even a property in a few months when prices go down and hope you make money of it.

this is better than investing in car as cars depreciate roughly 24% a year with 44% in first year with the loss of tax.

foxy-stoat

YKNA wrote: »

Best way to do is something called lease purchase on a fixed two year term normally 3+23 months package.
The trick here is not give the car back at the end of the term or pay balloon instead sell the car and keep the equity.

Agreed, the best way to make as much money is to sell the car that you 100% do not own and not pay the balloon payment. Priceless.

Or buy a gun and mask and rob a bank.

Opalset

ha ha ha

off to buy a mask....

JimmyTheWig

Is buying this car an emergency? If so, use your emergency savings.
If not, save up to buy it.

Opalset

JimmyTheWig wrote: »

Is buying this car an emergency? If so, use your emergency savings.
If not, save up to buy it.

not an emergency - current car done 95K but running fine

AnotherJoe

The best way is a combination.
Often you can get £2-£3k off for taking out PCP. Its an extra incentive from the finance company.

Start with CarWow or Drive the deal first.
Then buy on PCP.
Then settle the finance meaning you are no longer paying the % on the PCP but you got the £2k or whatever contribution.

Then juggle with 0% credit cards.

YKNA

so here is an example
I have done this several times with Mercedes
see this link here to view the following car
https://www.nationwidevehiclecontracts.co.uk/car-leasing/mercedes-benz/e-class/saloon
the price is £403 a month based on 23+3
total payable is £10478
buy price on that car is starting from £36K plus
when you lease purchase the manufacturer saves on Vat on resell and makes money on reselling the car so they discount heavily on the car price upfront
do the maths yourself and buying that car back of them will be sub £20K so you can sell that car for about 24K making £4k back only investing £10478 over two years rather than paying the whole lot up front. if you bought that car for £36K you would lose the vat on the first year and depreciate 20% first year minimum and same again second year so would lose
£6K vat and them £6K followed by £4800 the second year. car would be roughly valued at £19200. so in total you have lost £16800 my way you lose £10478 however probably make £4K on resell. I hope that makes sense and lease purchase is the same as any type of finance you get from any manufacturer but is a loss leader for them so they dont advertise it.

Mobeer

There is probably no one single ideal choice for all purchases; instead you need to consider it on a case by case basis. Look at all the options, shop around with brokers if dealers look bad.

System

Opalset wrote: »

not an emergency - current car done 95K but running fine

What is the reason for changing? Could it not wait until you've got the extra money? If you're intent on spending a mad amount of money on a car it would be the better option.