New application or accept higher rate?

jimbo26

Consider do you really need to keep the car? Hand it back and buy a cheaper car with you savings. Use the £350 you will save each month to pay down your credit cards and save.

Just think for a moment you will be paying off over 30k for a car that will be worth a grand in ten years.

foxy-stoat

b_real wrote: »

Not sure if your opener was sarcastic or not but I'll go with not, so thanks

Also not sure what the price of a twix has to do with anything. A twix on offer at £1 is available at that price to 100% of people who try to buy it in the offer period. A loan that is advertised at 2.9% is only available to 51% of people who try to buy it in the period its on offer, is potentially false advertising! Something must regulate whether they are actually giving 51% of applicants this rate, otherwise they could be telling porkies.

No you were correct first time, here on the loans board we see these threads pop up weekly.

You won't be the last.

b_real

Calpol4life wrote: »

Why, on earth, if you have the capital in savings, would you take out a loan to pay off the car?

Forget emergencies - you have credit cards already so worse case, you pay for any emergency with that.

Literally makes no sense.....

All this agro when you could just pay from savings?

As mentioned, I'm planning to use the savings to buy a house to live in so I'm reluctant to touch that. Also next month I'm moving to a new job and a flatshare which will give me a significantly bigger monthly net save, so I'll be able to whack lumps out of the credit situation easily enough anyway (and save for a bigger house deposit).

Just trying to understand the mechanisms of advertised representative APRs and potential false advertising.

jimbo26 wrote: »

Consider do you really need to keep the car? Hand it back and buy a cheaper car with you savings. Use the £350 you will save each month to pay down your credit cards and save.

Just think for a moment you will be paying off over 30k for a car that will be worth a grand in ten years.

Because getting a cheaper second hand car comes with all sorts of problems. I've owned my car since 5k on the clock so I know how its been driven and taken care of over the last 4 years, and I love it! Plus the bulk of the depreciation has already been absorbed. I can buy it and sell it privately for a 1.5k profit (using the term profit pretty loosely here!).

Also, call me mad but I think it will appreciate in value! They don't make em like this one any more.

[Deleted User]

b_real wrote: »

As mentioned, I'm planning to use the savings to buy a house to live in so I'm reluctant to touch that.

Remember that lenders will take your debt into account when you apply for a mortgage, so there's little benefit in trying to protect your savings as you'll be able to borrow less.

The debt also of course reduces your attractiveness to lenders.

Candyapple

b_real wrote: »

Just trying to understand the mechanisms of advertised representative APRs and potential false advertising.

Here you go OP, just one of many threads where the same thing has been said ad infinitum:

https://forums.moneysavingexpert.com/discussion/6001844/why-cant-i-get-the-advertised-apr&highlight=

All you can do is apply for maybe another 2 lenders and see how you fare with their APRs.

b_real

Deleted_User wrote: »

Remember that lenders will take your debt into account when you apply for a mortgage, so there's little benefit in trying to protect your savings as you'll be able to borrow less.

The debt also of course reduces your attractiveness to lenders.

Yep I've spoken with the mortgage advisors about my situation. There's some complex maths going on with lower mortgage rates (i.e if I had a higher deposit) compared to how much they'll lend me based on salary and current debts. My current debt situation is at a sweet spot where it's worthwhile keeping my savings and using it towards deposit rather than reduce debts (which are at low %), in order to get better rates through lower LTV.

b_real

foxy-stoat wrote: »

No you were correct first time, here on the loans board we see these threads pop up weekly.

You won't be the last.

Alright champ calm down, maybe use a SNICKERS instead of a twix in your next poor attempt at loan analogy

Candyapple wrote: »

Here you go OP, just one of many threads where the same thing has been said ad infinitum:

link removed

All you can do is apply for maybe another 2 lenders and see how you fare with their APRs.

Apologies if I've offended anyone for not reading all the other posts on the forum before posting. If this area is such an issue for all the regulars here then maybe get the mods to pin a sticky?

b_real

Thanks for everyones advice on here so far. I ended up applying for a new one with RBS and got 0.1% above the representative APR of 3.4%. Pretty chuffed with that.

Interestingly, they had a pre-application process that conducts a soft search (much like the MSE eligibility calculator) and it gave me a 'fixed' APR figure, i.e. the rate they would give me if accepted after a full application. Go RBS!