Best option for new car.

paulross8105

Two years ago I took out £7600loan from Tesco for a car. Today I still have £3400 to pay back. 

I was considering selling the car for around £5000 leaving me with £1600 to put towards a new car with a budget of £12000 

I was wondering what was the best course of action.  Extend my loan with Tesco, finance the car or get another loan. Not very knowledgeable on this stuff 

Cheers 

[Deleted User]

Keep the car, clear the loan.

DrEskimo

How do you work out a budget of £12,000 if you only have £1,600 to put towards a new car?

paulross8105

DrEskimo said:

How do you work out a budget of £12,000 if you only have £1,600 to put towards a new car?

“I was wondering what’s the best course of action, extend my loan with Tesco, finance the new car or get another loan. Not very knowledgeable on this stuff”.   If I had £12000 I wouldn’t be on a money site asking the best way to get £10,400. 

FYI I can’t keep the car getting high milage, not fuel efficient and want to sell while it still has some value. 

DrEskimo

paulross8105 said:

DrEskimo said:

How do you work out a budget of £12,000 if you only have £1,600 to put towards a new car?

“I was wondering what’s the best course of action, extend my loan with Tesco, finance the new car or get another loan. Not very knowledgeable on this stuff”.   If I had £12000 I wouldn’t be on a money site asking the best way to get £10,400. 

FYI I can’t keep the car getting high milage, not fuel efficient and want to sell while it still has some value. 

My point is where does the £12,000 figure come from? Why not £1,000, or £5,000 or £15,000?

Aran76

You can borrow the amount you need on a personal loan, some lenders are offering 2.8% APR or near, Tesco are one of them. That will probably be your best route because if you are taking dealer finance (PCP or HP) then the rates will be much higher, particularly on a used car.

eye4abargain2010

A lot of things to consider if looking for the cheapest way. Savings, poor interest rates on savings etc etc.  For my last 2 car purchases I have took out a new credit car a few weeks before deciding on what car to purchase. Research car and funding first.  I have used some savings (low interest rates), part exchange to get the amount required close to the max limit on card (-£500).  Paid the balance with the credit card and got the extra purchase protection and 25 months interest free with NO FEE. Set up the direct debit for the minimum and put the card in the drawer until about 6 months before your free period runs out and keep an eye on the BALANCE TRANSFER deals with NIL fee, such as Sanatander at this time.  All subject to personal circumstances and ability to manage the debt you can shake your own hand instead of the bank manager offering you a loan or indeed the car salesman at higher rates.

foxy-stoat

DrEskimo said:

How do you work out a budget of £12,000 if you only have £1,600 to put towards a new car?

Cos he is going to get another loan for 10 large.

getmore4less

What rate is the current loan?

 how much longer to go. 

What rate can you get new loans to top up

What finance or lease options are there. 

General rule don't take out debt for longer than the life of the thing you are buying. 

MinuteNoodles

I've a better idea. 
Sell the car, pay off the loan, use the £1600 left over to buy a car outright. Save what you would have been making in payments in a savings account, in 3-4 years but a much newer car in cash.

macman

But it won't be as nice and shiny as a new one...