Car Finance advice
Comments
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Absolutely no NEED for a 4x4 for the OP but if she (and you) want one that’s fine but don’t try and kid people who know better that it’s because of the size.
Nail on head.
So many people have a want, and try to justify it by turning it into a need, in their ead at least.As long as its not a tiny hatchback, I think a dog would be more bothered about how you drove the vehicle, not the badge on the front.0 -
You may possibly be right but I don't see the point in getting into great debt for a car.
Save up and buy what you can afford.
Agreed.
Peoples attitudes to taking on substantial long term financial obligations have reached a point where this is now the norm. However, that doesn't mean it is prudent or wise or value for money, or necessary. I certainly wouldn't do it. As long as you buy carefully, a £500 car can be a reliable daily driver and also fine for ocassional long journeys.
But life can be short and there's something to be said about doing what makes you happy from time to time. As long as people have considered the all costs and risks, they are going into it with their eyes open..0 -
henrik1971 wrote: »Agreed.
Peoples attitudes to taking on substantial long term financial obligations have reached a point where this is now the norm.
In the USA this has now got to the point that people think it perfectly normal to pay $500 a month for a car. Already in this country we've got to the point where people see no problem buying a car on finance which is worth more than their annual earnings.0 -
tonycottee wrote: »What percentage of people do you think borrow money for a car? I know very few that have ever bought one outright.
Based on my last car purchase I can give you a good idea.
I bought a 15 month old Merc from a Mercedes Benz main dealer about 2 years ago using cash (well actually my debit card plus £500 on a credit card for the protection).
When the car was ready to collect, they asked me to bring my driving licence with me when I came to collect it.
I didn't have it with me, so I asked if a copy would be OK as I could have my wife scan it and e-mail it to me, only to be told "actually, you don't need to bring yours at all"
So out of curiosity I asked why they told me to bring it if I didn't need it?
Their reply was: "We only need it for proof of ID for if you take out the finance, and because 90% of the cars we sell are bought on our finance I asked you to bring it out of habit, sorry for the confusion".
90% and that was just Mercedes dealer finance, not even those who arranged their own loan! :eek:• The rich buy assets.
• The poor only have expenses.
• The middle class buy liabilities they think are assets.
Robert T. Kiyosaki0 -
Finance can often make a lot more sense than cash, with a low enough interest rate or to get access to the dealer contributions. 90% are taking the car out with finance, but we don't know how many are clearing it when they get home.Already in this country we've got to the point where people see no problem buying a car on finance which is worth more than their annual earnings.
Can you cite an example of this? I seriously doubt any finance company will let them finance a car for more than their annual salary.0 -
Finance can often make a lot more sense than cash, with a low enough interest rate or to get access to the dealer contributions. 90% are taking the car out with finance, but we don't know how many are clearing it when they get home.
My guesstimates from what I see happening around me is a lot of people want a newish car, but i bet surprisingly few people have £20k or even £10k just laying around in their bank accounts so they use some form of credit. We've all seen these surveys about the large proportion of the population who have no savings, and the next tranche of people who would be in dire straits if their salary were to arrive late one month.
As to people going into a Merc Dealership, going home and clearing the finance, it does happen - one of my mates did it at the BMW dealers with a 330d estate and saved several thousand on the cash price, but I do think such people are the exception.
Massive generalisation here, but why do 'old money' wealthy people tend to have old Jags and old Land Rovers - yet I can take you to a street a few miles from where I live and there are rows of terraced houses worth £80-90k, yet parked outside a lot of them are BMWs, Mercs, Audis, and all sorts of other fancy sport or SUV style cars?
Car buying is not just about buying a means of transport. A big part of it is a lifestyle statement/choice based on how you see youself and what image of yourself you want to project to others. Those with "less" (money, confidence, etc.) might subconsciously over compensate by spending more than is sensible.
The only people buying new (or newish) cars who could legitimately disagree with that are those people who have bought a poverty-spec Dacia or similar.0 -
I think that this is a great forum, but I think some of the views are very simplistic.
1. Just because you can buy a perfectly good car for significantly less than £10k... why should that automatically be the best option? If everyone had this mindset, nobody would buy new or more expensive cars and thus these 'perfectly good' £4.5k cars wouldn't exist for all you thrifty money savers!
2. Some people like nicer cars, which is absolutely fine.
3. I agree, some people borrow irresponsibly or get very poor value pcp/lease deals on cars and end up trapped or in trouble. However, borrowing to buy isn't necessarily bad, as long as you can afford the repayments and the interest rate is reasonable. Importantly, you should ensure that you won't miss the money, can still afford to save, pay for bills, socialising, pensions, etc.
4. Often it's better to borrow to purchase a high value item such as a car, even if you have the cash in the bank. For instance, I am looking for a used car, budget is £25k. I could afford to pay cash for this car, however, in my opinion, it's sensible to borrow the money required with a cheap loan (3%). This allows me to keep hold of my cash which brings security, but also allows me to invest my cash elsewhere where I can make a larger return on my investment than the interest that I'm paying on my loan.
5. If we should all save up to buy things first... why do you have mortgages? I bet most of you wouldn't believe the amount of interest paid on your mortgage over a 25 year term (often well over £100k!).
Being a saver is great, but security is valuable and investing/using your money wisely is often ignored.0 -
henrik1971 wrote: »My guesstimates from what I see happening around me is a lot of people want a newish car, but i bet surprisingly few people have £20k or even £10k just laying around in their bank accounts so they use some form of credit. We've all seen these surveys about the large proportion of the population who have no savings, and the next tranche of people who would be in dire straits if their salary were to arrive late one month.
As to people going into a Merc Dealership, going home and clearing the finance, it does happen - one of my mates did it at the BMW dealers with a 330d estate and saved several thousand on the cash price, but I do think such people are the exception.
Massive generalisation here, but why do 'old money' wealthy people tend to have old Jags and old Land Rovers - yet I can take you to a street a few miles from where I live and there are rows of terraced houses worth £80-90k, yet parked outside a lot of them are BMWs, Mercs, Audis, and all sorts of other fancy sport or SUV style cars?
Car buying is not just about buying a means of transport. A big part of it is a lifestyle statement/choice based on how you see youself and what image of yourself you want to project to others. Those with "less" (money, confidence, etc.) might subconsciously over compensate by spending more than is sensible.
The only people buying new (or newish) cars who could legitimately disagree with that are those people who have bought a poverty-spec Dacia or similar.
I agree to a point but like you said a massive generalization, we cannot tar everyone with the same brush, some people are huge car fans like me, some people like to drink, some like to smoke, some like to go on 2 hoidays, some like to gamble, some like to spend on the house and some just like cars
im currently looking for a bmw e46 m3 or an e60 m5 why because im a big car nut, for me a car is my true passion always loved cars love working on them everyday makes me happy, id rather tinker about with an engine than sit inside and watch fictional soaps.
i have a few e30's classics parked up which i bought dirt cheap a few years ago the 325i m-tech 2 has trippled in value but im still holding on to it, its my pride and joy
i dont buy cars because i want to show off or have low self confidence, or its a status thing and i could not give a monkys what my friends or neighbours think, the day they start paying my bills for me thats the day i may be interested in their opinion and what they think
just thought id put another side across“People are caught up in an egotistic artificial rat race to display a false image to society. We want the biggest house, fanciest car, and we don't mind paying the sky high mortgage to put up that show. We sacrifice our biggest assets our health and time, We feel happy when we see people look up to us and see how successful we are”
Rat Race0 -
I agree to a point but like you said a massive generalization, we cannot tar everyone with the same brush, some people are huge car fans like me, some people like to drink, some like to smoke, some like to go on 2 hoidays, some like to gamble, some like to spend on the house and some just like cars
And there's nothing wrong with any of this. As long as you're living within your means it's nobodies business what you spend your cash on. Whether it's lifestyle statement, a reflection on how you'd like others to perceive you or simply because you're a car nut; it's nobodies business other than your own and is irrelevant in this forum.
However, none of these reasons are an excuse for spending beyond your means. I wouldn't go out and spend £50k on a sports car "because I'm a car nut". If I got an unsecured loan for this figure I could afford to repay it comfortably, but still I recognised that it would be poor judgement. I need to save for my future, invest money in other ways, ensure that if I lost my job I wouldn't be stuffed, may want to start a family in a few years, etc.0 -
Human_Being wrote: »And there's nothing wrong with any of this. As long as you're living within your means it's nobodies business what you spend your cash on. Whether it's lifestyle statement, a reflection on how you'd like others to perceive you or simply because you're a car nut; it's nobodies business other than your own and is irrelevant in this forum.
However, none of these reasons are an excuse for spending beyond your means. I wouldn't go out and spend £50k on a sports car "because I'm a car nut". If I got an unsecured loan for this figure I could afford to repay it comfortably, but still I recognised that it would be poor judgement. I need to save for my future, invest money in other ways, ensure that if I lost my job I wouldn't be stuffed, may want to start a family in a few years, etc.
Thats the point im making, its nobody's bussiness what you do or dont do with your money“People are caught up in an egotistic artificial rat race to display a false image to society. We want the biggest house, fanciest car, and we don't mind paying the sky high mortgage to put up that show. We sacrifice our biggest assets our health and time, We feel happy when we see people look up to us and see how successful we are”
Rat Race0
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