Loans - Help.........

[Kev_mk3]

ok with all this crap happing with my car and TBH i was thinking about selling it anyways im looking at getting a loan as ive found a car i could kill for!!

the car is up for £2.5k & i have outstanding debts of £1.5k i was looking online quick last night and if i take out £4.5k over 3years i pay back just over £5k and its around £140 a month at 7.9% APR ( i dont think thats that bad TBH )

im just worried about going further into debt but it will decrease my out goings per month and also once i findout whats going on with my car - the money i get for it / money for parts i break it for can go to pay the loan off OR if i get it fixed ill just stick it up for £1k for a quick sale Sad


what do you think? and will it affect me getting a mortgage within the next 12months as if it will im DEFO not doing it.


Kev

[Robspot]

As long as you don't default on the payments then it won't affect your mortgage chances (unless of course the £140 reduces your monthly available income to the level where the proposed mortgage payment becomes inviable - most companies won't let your monthly committments i.e. mortgage, council tax, loan and credit card payments go above 60% of your disposable income).

If you have no other credit at the moment then a loan may actually help with a mortgage application as they like to see some evidence that you have borrowed before and have a good track record of paying it back.

Otherwise I could have a chat with my mate Skullcrusher Smith who would be happy to lend you some money only his rates are a little high and his non-payment penalties a little severe 

[Steve Pyro]

Kev, make sure to get a good rate, with payment terms that you can afford.  As Rob said, defaulting is not clever and you could end up with a CCJ and a bad credit record and can kiss goodbye to getting a mortgage.

Sit down with the back of an envelope and work out all your income / outgoings to see what you can afford (considering your future potential mortgage payments).

With the money market disappearing up it's own orifice at the moment, good deals are hard to come by but, never the less, good rates are out their if you have a dig around.

[Lorry]

I'd check on morgages too.  The pre Northern Rock type are getting thin on the ground and expensive.  Lenders will look at other outgoings, and if you don't have the spare cash for the car it suggests income = outgoings already.

Having said that everybody seems to be up to their necks in debt, and the amount per person has gone from a negligible amount to more than the average Yank in the past 10 years.  So how much is on the credit cards?  Over 5 grand seems to be average.

[Kev_mk3]

at the moment i have £1500 ish on cards which isnt much i think. i pay around £200-250 off per month at the moment but with my car breaking i seem to be spending it back on there!!!!

if i got the loan and its £140ish per month so i will save nearly £150 per month. ( ill probs put this into my savings account )

as for credit history i have a phone bill and credit card - never missed a payment so should be fine. once my car situation is sorted it will either be sold / broken for parts and that money paid off the loan so the remainder of the loan ill try putting into the mortgage. i think it will affect the amount i can borrow but how much im not sure

[Robbo]

Check www.moneysavingexpert.com This guy is a genius! You could raise the money via credit cards then swop every 11 months to 0% so you pay no interest at all!

If you go this route, you have to be very disciplined and NEVER spent on a balance transfer card.

[Kev_mk3]

Check www.moneysavingexpert.com This guy is a genius! You could raise the money via credit cards then swop every 11 months to 0% so you pay no interest at all!

If you go this route, you have to be very disciplined and NEVER spent on a balance transfer card.

ive heard this can affect your Credit Rating tho 

[Steve Pyro]

Yes, applying for numerous credit cards shows up on your credit rating and is frowned upon by some lenders.

[Kev_mk3]

well i have found it cheaper the loan thanks to www.moneysavingexpert.com think its best to get the insurance just in case aswell 

going to see if my bank will match it. then if the seller of the car comes back to me with good answers to the questions ill apply probs

[Andy Zarse]

Kev, here is some advise from a wrinkly, forget the loan for the time being, forget the £10,000 car, it will only devalue.

Get a cheap Pug 305 diesel from the auto auction for £500 squid, (piggers has good contacts) cheap to run, pay off your credit cards, it'll be done in less than a year.  Ride out the market down turn and get some ackers/moolare/shekels/spondo's behind you.

You'll be better off, won't worry about interest rates, they'll be going north not south, you'll be able to afford to come out and join in with your CA chums, enjoy your photography, you need a new lens already and not complain that you can't afford to come out and be a sad sop sitting at home washing a car you can't afford to drive anywhere.

No one worries about what wheels you have, if they do, they're not real friends.

Kev, this is the best advice I've read on CA in a long time. Don't do it! Spending 10 grand on a car if you also want to buy a horse is totally nuts. The only advice I'd change is to buy a cheap Jap car, they are far more reliable than an old Pug, which are as dodgy as hell, probably worse than the dreaded MkIII Astra! You might even get something quite cool like a Honda Prelude (I had a 2.2 Vtec one, it's one of the all time greats) or a nice Celica for not much more than £1500. For example;

http://search.autotrader.co.uk/es-uk/www/cars/HONDA+PRELUDE/Ne-2-4-5-6-7-8-27-44-49-53-61-64-67-103-133-146,N-9-4294966502-4294967196/advert.action?R=200810305041050&distance=23&postcode=rh17+6ez&channel=CARS&make=HONDA&model=PRELUDE&min_pr=1000&max_pr=&max_mileage=

[nickliv]

Kev

I'm with these two, I've borrowed money to buy cars, then been distraught after a few years that they're worthless (That's what you get when you buy Saabs)

Much better to do the 'loan in reverse' trick - buy a shitbox, and set up a SO for what you would have spent on the loan. That way you won't care if a wayward firework lands on it at LM, or if a drunkard topples over onto it. No one will notice it at LM anyway, as there'll be cars littering the place that cost more than a house, a 10 grand chariot will attract no gawpers at all. And you'll end up with money in the bank, and no debts.

Volvo 340, easily tunable, (Engine swops a piece of piss) cheap as chips, RWD. Weld up the diff, matt black rattle can respray and you've got a tramp drifter for the roundabout of ridiculousness.

http://tinyurl.com/2klj9o

(I don't think there's a word spelt correctly in this ad)

Or, if you want a cheap car that costs a bomb to run, I can recommend old saabs - they go on forever, but require a ton of TLC

This 230 bhp luxo barge will struggle to hit £1500

http://tinyurl.com/2kc43m

[termietermite]

Yup.  I agree. Now's the time for a bit of "Bangernomics" - the £'s up sh*t creek without a paddle - now is not the time to be borrowing money, no matter how many loan companies tell you it is.  Buy something small and unfashionable (AZ's right - the Japs are great for this) and like as not by next year it will sell for not much less than you paid for it.  If not, scrap the thing and spend another £500 on something else. Yeah, you might have to follow the dangerous pursuit of driving with a paper bag over you head for a few months, but at least you won't be pouring money down the plug hole.

[Kev_mk3]

TBH i have applied for ALOT of jobs last week some local some mean ill be moving to the midlands. if i get a local one then i will sell the car and use that dreaded public transport  if i get the job in the midlands ill travel and move there - then lose the car

best way i can see

[vqdave]

Kev, here is some advise from a wrinkly, forget the loan for the time being, forget the £10,000 car, it will only devalue.

Get a cheap Pug 305 diesel from the auto auction for £500 squid, (piggers has good contacts) cheap to run, pay off your credit cards, it'll be done in less than a year.  Ride out the market down turn and get some ackers/moolare/shekels/spondo's behind you.

You'll be better off, won't worry about interest rates, they'll be going north not south, you'll be able to afford to come out and join in with your CA chums, enjoy your photography, you need a new lens already and not complain that you can't afford to come out and be a sad sop sitting at home washing a car you can't afford to drive anywhere.

No one worries about what wheels you have, if they do, they're not real friends.

Kev, this is the best advice I've read on CA in a long time. Don't do it! Spending 10 grand on a car if you also want to buy a horse is totally nuts. The only advice I'd change is to buy a cheap Jap car, they are far more reliable than an old Pug, which are as dodgy as hell, probably worse than the dreaded MkIII Astra! You might even get something quite cool like a Honda Prelude (I had a 2.2 Vtec one, it's one of the all time greats) or a nice Celica for not much more than £1500. For example;

http://search.autotrader.co.uk/es-uk/www/cars/HONDA+PRELUDE/Ne-2-4-5-6-7-8-27-44-49-53-61-64-67-103-133-146,N-9-4294966502-4294967196/advert.action?R=200810305041050&distance=23&postcode=rh17+6ez&channel=CARS&make=HONDA&model=PRELUDE&min_pr=1000&max_pr=&max_mileage=

Just back from my holidays and funnily enough i am flogging my old prelude 2.2vtec, as andy says a great car, very fast, handles lovely, well built and reliable, got it up on pistonheads at £1400.....

[Piglet]

TBH i have applied for ALOT of jobs last week some local some mean ill be moving to the midlands. if i get a local one then i will sell the car and use that dreaded public transport  if i get the job in the midlands ill travel and move there - then lose the car

best way i can see

Hang on, have I got this right?  you're carrying credit card debt but living at home?   You don't have a job but you're talking about getting a car loan? 

Listen to FS/AZ/TT etc., they talk sense on this.....my plan would be to throw as much money at debt as possible, then save as much as possible and then be in a position to buy a property with a decent deposit - in this climate you'll need at least a 10% deposit now to attract the interest of a lender and any debt (loans/CC) will be taken off the amount you can borrow.