Buying a new car £10k, best way to buy please?

jungleboy123

Hello,

I have the money in the bank but need advice as the best, most efficient way to pay for the car?

If i pay by cash, should i put a deposit with a credit card to get S75 protection?

Would it also be wise to get a 0% CC and pay that way, and keep the £10k in savings to pay it off once the 0% period ends?

Any other suggestions?

Thanks.

DE_612183

are you buying from a dealer or privately?

jungleboy123

DE_612183 said:

are you buying from a dealer or privately?

from a dealer.

CliveOfIndia

It's a good idea to pay a small deposit by credit card to get the S75 protection, then pay the balance by cash.

Dealers will not normally accept the full payment by credit card, due to the fees they have to pay (which scuppers the 0% card idea, attractive though it seems).  However, they'll usually accept a small deposit (often something like £500), and this will give you the S75 (although do remember it's not a magic panacea that will cover everything, but it's a useful added extra if you can get it).

The only other consideration might be if the dealer offers a contribution if you take out their finance.  It's sometimes possible to take the finance, grab the dealer contribution then settle the finance after a month.  If you do this, you will likely have to pay an early settlement penalty, but often the dealer contribution will outweigh the settlement fee.

Although, finance tends to be offered on new cars more than used ones.  If it is offered then certainly look into it and do the sums - but mostly, for buying a used car it's a case of deposit on credit card and balance by cash (most dealers these days prefer bank transfer).

jungleboy123

CliveOfIndia said:

It's a good idea to pay a small deposit by credit card to get the S75 protection, then pay the balance by cash.

Dealers will not normally accept the full payment by credit card, due to the fees they have to pay (which scuppers the 0% card idea, attractive though it seems).  However, they'll usually accept a small deposit (often something like £500), and this will give you the S75 (although do remember it's not a magic panacea that will cover everything, but it's a useful added extra if you can get it).

The only other consideration might be if the dealer offers a contribution if you take out their finance.  It's sometimes possible to take the finance, grab the dealer contribution then settle the finance after a month.  If you do this, you will likely have to pay an early settlement penalty, but often the dealer contribution will outweigh the settlement fee.

Although, finance tends to be offered on new cars more than used ones.  If it is offered then certainly look into it and do the sums - but mostly, for buying a used car it's a case of deposit on credit card and balance by cash (most dealers these days prefer bank transfer).

thanks, will consider.

400ixl

Is it a main dealer or a used dealer?

More for main dealers but may apply to car shop type used dealers as well, finance may not give you any financial advantage as in the price, but could come with a service pack or additional warranty. Worth considering and then just paying off the finance. under the right to cancel in the first 14 days which has minimum cost. Typically the threshold is £10k for these sorts of benefits so you may get lucky.

As mentioned a 0% card would only be of any use if it is a balance transfer as very few dealers will allow you to pay £10k straight onto a card. Doing the £100 minimum deposit on one is absolutely worth doing.

When I last bought mine it was deposit on credit card, £10k on finance (and cancelled to get the Service Pack) and then the rest on debit card on collection. Didn't need to do a bank transfer for any of it.

CliveOfIndia

400ixl said:

As mentioned a 0% card would only be of any use if it is a balance transfer

I presume you mean a money transfer?

400ixl said:

the rest on debit card on collection. Didn't need to do a bank transfer for any of it.

That's an interesting one.  I always used to pay by debit card on collection, back in the day - quick, safe, convenient and the dealer can confirm instantly that the money has gone through.  The last few times the dealer has requested a bank transfer.  I've no idea why (I mean, I know they pay a fee for debit card transactions, but it's a tiny amount).  I'm sure there's a valid reason for it, but as far as I'm concerned it makes no difference to me.

Ectophile

Paying on debit card is usually an option.  It's less effort for you than a brown envelope full of used twenties, and it's less effort for the dealer too.  Banks charge for depositing cash into a business account, so the dealer still has to pay a fee.

But if you can pay the deposit on a credit card, that gives you some protection.  They are unlikely to accept the full payment on a credit card as the fees are higher.

facade

With £10,000 most places won't accept cash. It is trouble for them to have hanging around, to pay into the bank, and they get charged a transaction fee to pay cash into a business account.

So either pay by bacs transfer the day before, or try and pay with a debit card on the day, but you will be hanging around for hours while the payment clears if you try and do it on the day.

Bigphil1474

Not sure the op meant they had a wodge of notes in their hands ready to pay for a car, more that they didn't need a loan, or to borrow the money to buy a car. I could be wrong. OP, nothing else to add, as above see what the dealer is offering. 

CliveOfIndia

Bigphil1474 said:

Not sure the op meant they had a wodge of notes in their hands ready to pay for a car, more that they didn't need a loan, or to borrow the money to buy a car. I could be wrong.

That's certainly what I take the word "cash" to mean in situations such as this - debit card or bank transfer rather than actual physical banknotes.

Large amounts of actual cash (notes or coins) is actually a real headache for businesses.  A business bank account will usually levy a charge for depositing physical cash.  There's a risk in keeping large amounts of cash on the premises (and very often their insurance will place a limit on the amount of cash that's covered).  Then there's the hassle - and, again, risk - of taking the cash to the bank.  Or else you have to pay for a security company to come and collect the cash and take it to the bank for you.

It's different for the local independent corner shop, of course, where the sums involved are much smaller and many people still like to use cash, especially for small purchases.

But (and sorry, going off on a slight tangent here), that's one reason why large supermarkets offer cashback when using a debit card to buy your shopping.  They need to keep some cash on the premises for people who want to use cash.  But if they can get rid of the majority of it by giving cashback to people that want it, it saves them a lot of hassle and expense.