Car dilemma, help!

popcornfeet

We bought a car on a 60 month HP plan almost 6 months ago now, a hybrid, which ‘should’ have saved us money on fuel but in fact has the opposite affect as we do a lot of long distance / motorway driving. It’s extremely thirsty getting 35-38mpg in comparison to our previous diesel car which was getting 70mpg+ (except for when in hybrid mode round town-which is rare).

We can only just afford this vehicle and it’s taking a large chunk out of our money as the insurance is ridiculous too with being a hybrid, and are thinking it may be best to just sell - but there’s approx 2,100-2,500 shortfall due to a mixture of rapid depreciation and a small shortfall from our previous vehicle. Hubby is hoping to become S/E in the coming year also so thought it may be best to reduce the debts. The monthly payment is £379.99, plus approx £55 insurance, £16 tax each month.

Are we best selling and paying shortfall on a CC? Or trading in for a banger? Or waiting a bit of time to sell? Is it going to be a long time before the shortfall is covered?

In a bit of a pickle, don’t really want to sell but it seems the best option for now. Hubby has a car we can share (at a push) for 6 months to a year, but then he will need use of it full time. 

Ayr_Rage

Insurance on hybrids is not significantly more expensive than petrol/diesel vehicles.

If you want to go the "banger" route you'll have to accept that you'll need to take the hit on the shortfall if trading down at a dealer or somehow finding that ~£2500 elsewhere.

You won't be able to pay off a credit agreement shortfall with a normal credit card.

You'll also have to factor in MOTs and possible repairs on a banger.

What make/model is it and was it a brand new vehicle?

If the car was brand new when you purchased it I am surprised the shortfall is so small to be honest.

Hoenir

What's the vehicle? 

popcornfeet

Insurance on previous car was £25 per month,  (Qashqai 1.5 diesel > MG HS Hybrid 1.5 Turbo), may not be the hybrid but it’s double the cost all the same. 

Car was 2 years old, registered in Jan 2023, there was about £1000 from our previous car added to the finance, and then £1,500 depreciation approx. 

In previous years we have paid shortfalls on our credit card, have the rules changed? 

Thanks

Ayr_Rage

In general you cannot pay off a credit agreement directly with another form of credit.

"Dodgy Dave" may take a credit card payment and then pay off the finance on your behalf.

Mildly_Miffed

Ohnoes! Only 38mpg!

Well, hold on, let's look at that in terms of actual fuel cost per mile.
38mpg @ £1.31 current average petrol price = 15.6p/mile
70mpg @ £1.38 current average diesel price = 8.9p/mile
Difference = 6.7p/mile.

How many miles are you doing annually?

At a difference of 6.7p/mile, it will take you over 37,000 miles to recoup the £2,500 negative equity on your current finance, let alone the other costs to change.

£380 x 60mo? £23k finance? There are 70 2023 HS hybrids on Autotrader. Only 4 of them are over £20k, and not one is over £21k...

Also, the fuel consumption shouldn't have come as a surprise...
https://www.honestjohn.co.uk/realmpg/mg/hs-2020/15-t-gdi-phev
Assuming 2014-2020 Qashqai 1.5dci, real world economy is actually high 50s mpg.
https://www.honestjohn.co.uk/realmpg/nissan/qashqai-2014
Taking the best case there of 60mpg, that reduces your fuel cost gap to 5.2p/mile, so 48,000 miles to cover the £2.5k shortfall alone.

ontheroad1970

Ayr_Rage said:

In general you cannot pay off a credit agreement directly with another form of credit.

"Dodgy Dave" may take a credit card payment and then pay off the finance on your behalf.

If this were true, there wouldn't be debt consolidation loans.  Because of the APR of credit cards in general, using them to pay off lower APR forms of credit is obviously inadvisable

Ayr_Rage

ontheroad1970 said:

Ayr_Rage said:

In general you cannot pay off a credit agreement directly with another form of credit.

"Dodgy Dave" may take a credit card payment and then pay off the finance on your behalf.

If this were true, there wouldn't be debt consolidation loans.  Because of the APR of credit cards in general, using them to pay off lower APR forms of credit is obviously inadvisable

I did say DIRECTLY !

Go try and pay off your credit card with a credit card for a bit of sport.

popcornfeet

@Mildly_Miffed

How many miles are you doing annually? 

- 15,000-18,000 miles average per year.

Also, 23k finance includes previous shortfall from Qashqai - and interest - no deposit for the new car. You can't take the 23k figure as the purchase price for the car, as that is with added interest and the above costs; shortfall.

Also, regardless of 'Honest John', our Qashqai DID get over 70mpg, as displayed on the dash reguarly - mostly motorway journeys. Figures are dependent on how you drive etc, and where you drive/road conditions.

paul_c123

If you don't like the new car (and I don't blame you) get out of it ASAP, even if this means taking the £2.5k hit. Look around for a cheaper car. It might have more issues - but then a newish MG will have issues too.

If you're doing lots of motorway miles, a small diesel is always going to be better than a hybrid petrol. It depends how you use - or plan to use - the car.

jimjames

popcornfeet said:

Also, regardless of 'Honest John', our Qashqai DID get over 70mpg, as displayed on the dash reguarly - mostly motorway journeys. Figures are dependent on how you drive etc, and where you drive/road conditions.

Just be aware that the number on the dash isn't necessarily what the car is actually achieving. To know the accurate number you have to measure full tank to full tank which tends to be lower than the figure shown on the dash.