Advice on Company car thing please

Debt_padawan

Hi All. I am in debt quite badly to the tune of about £15K, but I am managing to slowly drag myself out. I have a very bad credit rating, with a couple of CCJ's that I am again slowly clearing. However, I have the opportunity to opt out of my company car scheme and buy my company car. In return I will get after tax about £350 per month allowance. With the tax I save I will end up around £300 per month better off which will help me get out of debt quicker.
My dilemma is this: I need to borrow £5,000 to buy the car from my company, but with my current financial state the bank and other standard institutions will not touch me (The bank that likes to say yes, said NO).
I would be greatful if you folks could advise me. How can I get a loan with really bad credit? I am a tennant, so that makes things more difficult. Alternatlively , should I not be even thinking about another debt even though I would be better off out of the company car scheme?
Thanks in advance

Bargainloverbec

Hi Debt Padawan,

I found a really useful website called https://www.cashforcars.co.uk where you can literally punch in all your details (age, postcode, mileage, how much your company gives you for petrol, what car you have etc.etc) and it works out if you would be better off with a car or to take the cash. It factors in the insurance and maintenance costs as well which to be honest I hadn't thought about when I was looking at cars.

I used it and worked out I would be £26 better off per month with the cash - a lot less than I thought after you'd taken into account all the 'hidden' costs.

Hope that helps.

Iona_Penny

Yes please be careful when you think how much a month better off you will be because as pointed out htere are the running costs.

My husband has a car for which we pay the lease agreement of £91 per month (through work) but we then only pay private mileage fuel and nothing else no insurance or servicing etc When the tax is due it just comes through the post like magic!

As we all now know from being here budgeting means allowing every month for all expenses and that will mean car running costs so I feel you wont have £300 to throw at your debt each month . Sorry

Debt_Free_Chick

Is this a one off opportunity to opt out of the car scheme? Could you not opt out at a later date, when your finances are in a better shape?

nearlyrich

Who will pay for the maintenance, windscreens, tyres ? How will you replace the car when it is necessary to do so?

As Iona-Penny said with a car scheme the tax disc comes as if by magic... My new company car arrives tomorrow and by picking one with low emissions I will save £20 per month on income tax.

Debt_padawan

Hi All,

Thanks for all the replys, it was good to be brought back to earth a little. I will have a rethink on plans. However, if anyone else has any suggestions, I would be very greatful.