Changing car to pay debt?

snowdrop33

So budgeting has been going well for the first time ever. And we are paying fine are debts well. 

I wondered what people’s thoughts were on selling my car and getting a cheaper one to pay back some more debt. 

So I currently have a Ford kuga 2018 70k miles, I could change this in for a VW Passat estate 2012, 70k miles with Fsh and 12 month warranty. They would give me £9k for mine and the vw is £6k so I would have £3k to chuck into clearing some credit cards. 

I’m not really bothered by cars as long as it has enough space as we have two toddlers and two dogs. And it is reliable. 

I guess what worries me is it being a bit older and what could go wrong. But it is from a good dealer and has 12 months warranty and who says my current car won’t go wrong. The VW is also much more fuel efficient so I would save in fuel costs.

I also mainly use it for nursery drop offs as I work from home. Or we use it at weekends for family trips. So I don’t have to do long journeys. 

stu12345_2

I did something similar , I sold on  carwow,( very impressed )got  very good price  2016 208 GTi by Peugeot sport, £12500  paid off the finance, then bought an old estate vauxhall  2007 on eBay for £900. private seller.( it's passed its MOT today, no faults, same as last year, no faults, 134000 miles and has no service history at all, I got oil and air filter and plugs done when I bought it, £95)

I  used the thousands in difference to knock thousands of a credit card debt.

your best selling your car privately or carwow( even if it has finance, carwow sorts that out) and then  buying privately.
the dealer has profit in what he wants for your car, it's probably worth £1500 more and the passat is probably worth £1000 less.
 hes bought a used  car warranty for £50, you can do it yourself . anyway these warranties are so bad, you actually have more legal rights even without  a warranty if you buy from a dealer,   you can go back to him in 6 months time and say gearbox failed, fix or replace ,( even beyond  a year if the fault existed when you bought the car. if proveable at that timescale)

but my motto is if you buying a very newish car , wait for it to be 3 years old to save massively on the depreciation) and get it from a dealer, if you buy an old car,eg beyond 10  years old  buy privately ,.

ps avoid all diesels at all costs, dual mass flywheel problems ,  cat convertor etc

enthusiasticsaver

snowdrop33 said:

So budgeting has been going well for the first time ever. And we are paying fine are debts well. 

I wondered what people’s thoughts were on selling my car and getting a cheaper one to pay back some more debt. 

So I currently have a Ford kuga 2018 70k miles, I could change this in for a VW Passat estate 2012, 70k miles with Fsh and 12 month warranty. They would give me £9k for mine and the vw is £6k so I would have £3k to chuck into clearing some credit cards. 

I’m not really bothered by cars as long as it has enough space as we have two toddlers and two dogs. And it is reliable. 

I guess what worries me is it being a bit older and what could go wrong. But it is from a good dealer and has 12 months warranty and who says my current car won’t go wrong. The VW is also much more fuel efficient so I would save in fuel costs.

I also mainly use it for nursery drop offs as I work from home. Or we use it at weekends for family trips. So I don’t have to do long journeys. 

Whether or not I would change my car in your circumstances would depend not only on whether the new car is likely to be reliable and obviously at 12 years old there is the danger it could be a money pit but also how critical your debt situation is.  Given you have almost £50k in loans and you  say credit cards as well I think I would lean to getting rid of it as the VW is also cheaper to run.  Have you explored other options to see if you can get more than £9k for it?  Was the HP taken out for the Ford Kuga? There is a £10k difference between the HP and car value. Not totally unsurprising as if you bought from new the depreciation is massive in the first few years. 

stu12345_2

is it £19k you owe on your car, if so that's a big negative equity. you can keep payments up at normal by you on car in a dmp and do lower payments to loans credit cards, I did  and was allowed to when I owned my 208 car, stepchange allowed it,  before I sold it.

snowdrop33

Sorry so I should have updated my signature.
so my current debt is:
barclays loan approx 5.9% owe approx £11k
credit card I owe £13k on 0%

I can afford to pay these and they will be repaid in the next 4 years. But I was just trying to think of ways to pay it off sooner. 

MFWannabe

Personally I wouldn’t change it to another car that’s 6 years older just to bank 3k. You could keep current car for another 6 years at least where as the older car would then be 18 years old. 

I would think of other ways of finding extra money to throw at the debts 
If your debts were not manageable then I may think otherwise x 

fatbelly

I'm a bit of a car nerd as well as a debt nerd.

What engine have you got in the Kuga and what in the Passat?

If the Kuga has the ecoboost petrol engine and hasn't had a cambelt change I'd move it on sharpish. Similar advice if you have the auto gearbox and haven't been doing the regular fluid/filter changes.

Most Passats are manual diesels and can have clutch/flywheel issues.

snowdrop33

fatbelly said:

I'm a bit of a car nerd as well as a debt nerd.

What engine have you got in the Kuga and what in the Passat?

If the Kuga has the ecoboost petrol engine and hasn't had a cambelt change I'd move it on sharpish. Similar advice if you have the auto gearbox and haven't been doing the regular fluid/filter changes.

Most Passats are manual diesels and can have clutch/flywheel issues.

So the kuga is an automatic diesel I think a 2l engine. The Passat I was looking at was a 2.0 l auto. The mpg on the kuga I get about 34 and on the Passat its average is 55.

if these aren’t the best, any advice on a good large car. I don’t mind estate/suv. Just needs to fit dogs/bikes etc in. And I do like an automatic. 

Thanks 

fatbelly

I think on balance I'd stick with the Kuga but keep it maintained. Your garage needs to understand that those gearboxes are not 'sealed for life'.

The Passat may claim 55mpg but on the Honest John site people report 44mpg.

Low miles are also not good news for a diesel and 6k per year is low

You are doing 14 k per year so I expect those weekend trips are longer and are giving the dpf filter chance to regenerate.

I could try recommending something but there's no need. You are over the worst of the depreciation and ... Better the devil you know

stu12345_2

honda, toyota make the best cars, imo, are you sure it isn't a turbo diesel Passat.
the problem with autos is most are triptronic, dual clutch, cvt boxes these days, not real slush boxes, eg torque  converter traditional ones.
these are found in older  bigger bmw, mercs etc.
 I have had  peugeot 208s autos and yes they use slush boxes, amazing torque, 1.2  turbo petrol.

my astra is a 1.8 non turbo slush box auto 

automatic cars hold their value cos they are rarer

Rob5342

I always work on a lifespan of 10 years or 100,000 miles, obviously it's not exact and depends on lots of things. If it takes you 4 years to pay the debts off then the Passat could be 16 or 17 before you are finished so it might need replacing before then.