Looking to buy a car with a credit card

in Credit cards
7 replies 266 views
KachakaKachaka Forumite
4 Posts
First Post
Newbie
I am looking to buy a car with a credit card because some cards have 0% interest for 25 months which I think is better than a cheap personal loan of 3-3.4% interest rate! 

Is that information that I have correct and what credit card do I need to apply for? Checked my Experian credit rating and is 994 points (almost maximum)

Replies

  • TadleyBaggieTadleyBaggie Forumite
    5K Posts
    Part of the Furniture 1,000 Posts Name Dropper
    Forumite
    I assume you are purchasing from a dealer? Bear in mind that many dealers will not welcome credit card transactions due to higher charges.
  • MrFrugalFeverMrFrugalFever Forumite
    606 Posts
    500 Posts First Anniversary Photogenic Name Dropper
    Forumite
    I’d be surprised if any car dealer will allow more than £5k. You might be better off searching for a money transfer card, such as MBNA and doing a soft search eligibility check direct with them.
    There’s only 2 certainties in life; taxes and death.

    I make the rest up as I go along.
  • MalMonroeMalMonroe Forumite
    4.6K Posts
    Eighth Anniversary 1,000 Posts Name Dropper Photogenic
    Forumite
    First of all how much is the car you want?

    Then, are you sure you will be able to get one of the 0% interest cards over 25 months? After applying, some lenders change the limit as well as the time given to repay.

    Also, credit scores mean nothing to anyone, nobody ever sees them, except you. Your credit history is the important thing. And it's always a good idea to check all your reports, not just that of Experian but also Equifax and TransUnion.

    There's some info here about buying a car with a credit card - 

    https://www.moneyexpert.com/car-finance/how-to-buy-car-with-credit-card/

    (Note - it's from money expert, rather than money saving expert).

    It can be done. It might be a good idea to ring around a few dealers to see which ones accept payment by CC.

    I did once buy a car and paid the full amount by credit card. It was an old car and wasn't very expensive at all but it ended up going pear shaped and I ended up applying for a Section 75 refund. Not that I'm saying that will happen to you but just take care out there! (I got my money back plus compensation but it took 18 months)

    I'd advise you to shop around for both a car and a credit card and do a soft search to test whether or not you will have a good chance of being accepted or not. It's best if you do that yourself because the recommendations for credit cards we give on here may not be available for you.

    I wouldn't advise buying a car from any place other than a dealer, either because you can at least get your money back if it all goes wrong. I have learned from experience. 

    Good luck! Hope you find what you are looking for.
    Please note MSE forum rules state "no two people have the same circumstances or experiences and it is up to you to investigate, check and check again before you make any decisions or take any action based on information you glean from our community. Remember, don't rely on what you are reading. Verify it and protect yourself. You are responsible for any action you consequently make." Verify everything. Inappropriate comments will be reported, as per Forum rules.
  • KachakaKachaka Forumite
    4 Posts
    First Post
    Newbie
    The cars that I am looking are from a dealer. My budget for a car is £12,000 max but I can contribute £2-3000 as a deposit. I will start do soft searches for some CC and if I am approved then will ring the major dealers like arnold clark to see if they accept or has any charges.. 
  • SiliconChipSiliconChip Forumite
    440 Posts
    100 Posts Name Dropper
    Forumite
    Kachaka said:
    ...will ring the major dealers like arnold clark to see if they accept or has any charges.. 
    They are prohibited by law from making any charge for paying by credit card, which is why you're unlikely to find any dealer that will allow you to pay the full amount by credit card as they can't pass on the charges that they have to pay. You may need to rethink your plan.

  • Ebe_ScroogeEbe_Scrooge Forumite
    6.8K Posts
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    Forumite
    Kachaka said:
    ...will ring the major dealers like arnold clark to see if they accept or has any charges.. 
    They are prohibited by law from making any charge for paying by credit card, which is why you're unlikely to find any dealer that will allow you to pay the full amount by credit card as they can't pass on the charges that they have to pay. You may need to rethink your plan.

    Exactly this.  Any retailer who accepts payment by credit card has to pay a fee to the card company on every transaction, calculated as a percentage of the transaction value.  If the transaction is a couple of hundred quid then the fee is usually acceptable to the retailer, especially if it means they get more business.  When the transaction value is several thousand, the fee becomes significant.
    Many years ago, car dealers would usually pass the fee on to the customer if they wanted to pay by credit card.  The law was changed some years ago to make it illegal for a retailer to charge a fee for credit card payment.  But since the retailer still has to pay the fee to the card issuer, most dealers simply refuse to accept a card for anything more than a small deposit (which will give you S75 protection).
    All that aside, depending on your credit history (ignore the meaningless score), I think you'd be lucky to get a card with a sufficiently high limit to allow you to put the full value on it anyway.

    I may not know much about art, but I know what I like.
  • FarfetchFarfetch Forumite
    3.8K Posts
    1,000 Posts Second Anniversary Name Dropper
    Forumite
    Money Transfer card with 0% interest is going to be your best bet to part finance, put the deposit on CC for S75 cover (even 1p, but typically £500 is normal) and see what you can get for the MT offer if you want to part pay. I would say almost 100% you a) won't get a card with that limit from scratch and b) the dealer won't want to take the hit of merchant fees

    He who rejects change is the architect of decay. The only human institution which rejects progress is the cemetery.

    -Harold Wilson


Sign In or Register to comment.
Latest MSE News and Guides