Car Finance

Alankmatthews

Hi,
I'm on the market for a new car and will be fortunate enough to pay for it outright (through unfortunate circumstances).

My question is, am I better to pay it outright or put down a deposit and take out car finance?
Someone said its better to pay the minimum deposit and finance the rest. What's everyone's view on this?

daveyjp

If the finance is 0%, or there is a hefty incentive to take finance (and you pay the finance off immediately) yes, otherwise why would you pay more for a car than you need to?

Pay cash, but treat the money as a loan to yourself and pay it back monthly to a savings account.

neilmcl

Most car dealers and manufacturers offer (sometimes significant) contributions as incentives to take out their finance when purchasing a new car. As you can legally cancel finance within 14 days and/or settle at any time there's nothing stopping you from taking on the finance to get these discounts then, as you have the cash available, cancelling or settling shortly after.

NottinghamKnight

If its a new 'new' car the finance deals are often attractive, take incentives and then look at paying off if you are being charged interest. If it's a used 'new' car then few incentives and generally better to pay cash. 

Car_54

NottinghamKnight said:

If its a new 'new' car the finance deals are often attractive, take incentives and then look at paying off if you are being charged interest. If it's a used 'new' car then few incentives and generally better to pay cash. 

Not necessarily. I've had massive "contributions" on an "approved used" car.