Applying for a loan at 19
Discussion
Hi all,
Looking to change my car next month. Everyone my age seems to go down the finance route however I don't want the finance to be tied to the car.
I've had a loan in the past albeit only for 2.5k, that loan was paid off this month. I've got a load of monthly direct debits I pay as well, phone contract, netflix, road tax etc.
I checked my credit rating on experian - 975. I'm not sure if this is because I haven't had much credit before or because I haven't missed a payment on the credit I have had.
I compared loans on one of the big comparison sites, one big name in particular came out on top (Hint - they also do insurance). They didn't have the lowest APR but they did have the best chance of accepting me compared to the others.
I applied for a loan with them on Monday, and haven't heard anything back. Their site says I should have recieved a decision within a day, so I'm starting to get worried that theres an issue and I'm likely to be rejected.
Anyone been in a similar situation? Or have any advice for someone of my age looking for a loan?
Cheers
Looking to change my car next month. Everyone my age seems to go down the finance route however I don't want the finance to be tied to the car.
I've had a loan in the past albeit only for 2.5k, that loan was paid off this month. I've got a load of monthly direct debits I pay as well, phone contract, netflix, road tax etc.
I checked my credit rating on experian - 975. I'm not sure if this is because I haven't had much credit before or because I haven't missed a payment on the credit I have had.
I compared loans on one of the big comparison sites, one big name in particular came out on top (Hint - they also do insurance). They didn't have the lowest APR but they did have the best chance of accepting me compared to the others.
I applied for a loan with them on Monday, and haven't heard anything back. Their site says I should have recieved a decision within a day, so I'm starting to get worried that theres an issue and I'm likely to be rejected.
Anyone been in a similar situation? Or have any advice for someone of my age looking for a loan?
Cheers
DonkeyApple said:
...
Then to cap that, the managers will be prioritising editing their list of which juniors won't be getting a bonus, pay rise, promotion etc just at the moment while also fending off hundreds of calls from the front office asking them why they haven't got a f
king grip on their department and insist on repeatedly hiring useless wasters. 
You sound like you may have knowledge of this... Then to cap that, the managers will be prioritising editing their list of which juniors won't be getting a bonus, pay rise, promotion etc just at the moment while also fending off hundreds of calls from the front office asking them why they haven't got a f
king grip on their department and insist on repeatedly hiring useless wasters. 
dogz said:
I'd ring them and chase
Age is against you, guess you don't own your own home, don't have much evidence in managing credit agreements which all turn a cheap lender off. These will be significant components of their scorecards
A better option might be to get a 0% credit card which allows transfers to your bank - obviously this depends on the sums you are looking to raise.
Also, if you are buying a car, why do you not want it to be tied to the asset? You will have a higher probability of getting accepted if there is security underpinning it (car).
I've realised age is a huge factor in this, I put all my details onto a loan comparison site and the majority had me on a 50/50 chance of being accepted - due to my age.Age is against you, guess you don't own your own home, don't have much evidence in managing credit agreements which all turn a cheap lender off. These will be significant components of their scorecards
A better option might be to get a 0% credit card which allows transfers to your bank - obviously this depends on the sums you are looking to raise.
Also, if you are buying a car, why do you not want it to be tied to the asset? You will have a higher probability of getting accepted if there is security underpinning it (car).
Edited by dogz on Thursday 20th April 22:55
My reason for not wanting the loan to be tied to the asset is flexibility, if I decide I need a change I can trade it in without dealing with finance companies as I'm the owner and registered keeper.
Also means that should the worst happen and I lose my job in a couple of years, I can sell the car and pay off the remainder of the loan.
Jaska said:
If you're looking for more opinions then you'll have to give us the figures. Total loan amount, length of loan and whether you would intend to pay it off early or not... And a rough idea of the car so we know how much depreciation is likely vs the full loan amount.
Some here will never use credit. Some have a benchmark so long as it makes sense financially. Some will accept at whatever APR!
Mini Cooper S - 14 plate, 12k miles. - £14500Some here will never use credit. Some have a benchmark so long as it makes sense financially. Some will accept at whatever APR!
Trading in a Citroen DS3 - WBAC value £5200, expecting £5000 trade in.
Loan amount is £9500 over 26 months - £400 a month.
I really dont have much outgoings with the exception of my car and insurance, so would probably manage to pay £550ish every second month or so.
DonkeyApple said:
Mixing chips with piss here but that is an absolutely moronic amount of money to be spending on a completely generic wagon at the age of 19. Assuming typical income levels of that age group and the lack of a trust fund.
I've been through 2 cars in the last 18 months, both of which I've had to change due to reliability issues. Theres lots of older cars I'd like which are priced a bit more reasonably, but I can easily rack up 300 miles a week so I'm going to go for a newer car with warranty this time round. My current car is a 1.6T so I don't want a step down in performance. I can get the mini with 3 years warranty and servicing for the 400 a month, and the only other costs would be insurance, petrol, mot and tax. Then when its paid off in 2 years I'll have a paid for car with a years servicing and warranty still left over. I'd rather spend this kind of money on a car now while my outgoings are low and I'm living at home, than in a few years when I'm looking to move out.
Just for comparison, majority of people my age have A1s, Polo Gtis, BMWs, Merc A classes - all leased. At least in this situation I'll pay maybe £100 a month more than them, and get to keep the car.
DonkeyApple said:
Offer your parents a better rate than they are getting on their cash or offer them a 2% premium over what they can borrow at.
8% is ridiculous in some regards but it is unsecured and your lender doesn't know who the hell you are. Your parents on the other hand would know exactly who they are lending to and also have security so would be able to lend to you at under 4%.
My initial thought was to borrow from my parents as I did this last time around. However this time they'd like me to take care of it myself, so said they'd be willing to guarantor me - which it turns out isnt required - however wouldn't lend me the money.8% is ridiculous in some regards but it is unsecured and your lender doesn't know who the hell you are. Your parents on the other hand would know exactly who they are lending to and also have security so would be able to lend to you at under 4%.
Appreciate all the replies.
With regards to the car cost, 14500 was one I found with the exact spec I wanted. If I cut out things that arent dealbreakers then there a few examples around a couple of grand cheaper. I'd also considered a Polo Gti, however considering most of these have bigger spec than minis of equal price as well as lower mileage gives me the impression depreciation seems to hit them harder. Another cheaper option was abarth 595. I've yet to try one but the interior puts me off a bit considering the mini would be a couple of grand more and have a lot more kit.
Without meaning to sound like a tosser, I get paid well for my age. At the moment my total car bills are 500 a month, however like I said in an earlier post my current car is now paid off. I've been on a lower wage than I am currently for the past year and still managed to pay the 500 required for my current car. I'm sure a few of you on here can relate - cars and driving are more of a hobby to me than anything else, so I do hear your critisims about paying so much but I've decided to go down this route already.
If anything, this should work out cheaper than my current situation as my insurance has came down a bit, and I wont be shelling out for repairs throughout the year since the car will be under warranty.
And yes, parents are stuck in their ways! Think they're just trying to force a bit of responsibility onto me.
With regards to the car cost, 14500 was one I found with the exact spec I wanted. If I cut out things that arent dealbreakers then there a few examples around a couple of grand cheaper. I'd also considered a Polo Gti, however considering most of these have bigger spec than minis of equal price as well as lower mileage gives me the impression depreciation seems to hit them harder. Another cheaper option was abarth 595. I've yet to try one but the interior puts me off a bit considering the mini would be a couple of grand more and have a lot more kit.
Without meaning to sound like a tosser, I get paid well for my age. At the moment my total car bills are 500 a month, however like I said in an earlier post my current car is now paid off. I've been on a lower wage than I am currently for the past year and still managed to pay the 500 required for my current car. I'm sure a few of you on here can relate - cars and driving are more of a hobby to me than anything else, so I do hear your critisims about paying so much but I've decided to go down this route already.
If anything, this should work out cheaper than my current situation as my insurance has came down a bit, and I wont be shelling out for repairs throughout the year since the car will be under warranty.
And yes, parents are stuck in their ways! Think they're just trying to force a bit of responsibility onto me.
mike9009 said:
I was once 19 and with hindsight wish I had not spunked so much money on loans. I was not desperately skint but lived for many years pay check to pay check, with about £6k on credit cards and similar in loans. (this was a few years back 
)
With hindsight and in your shoes I would keep the DS3 for another two years. Save £400 per month for your next car. I bet the repairs on the DS3 will not cost greater than the depreciation on the MINI plus the loan interest.
It is boring, but the DS3 is hardly a slouch.
'Boring' Mike
I appreciate where you're coming from, and running a cheaper car and changing more often has crossed my mind however insurance is a bit of an issue with that kind of thing at my age. )With hindsight and in your shoes I would keep the DS3 for another two years. Save £400 per month for your next car. I bet the repairs on the DS3 will not cost greater than the depreciation on the MINI plus the loan interest.
It is boring, but the DS3 is hardly a slouch.
'Boring' Mike
And just for reference, my DS3 as the non-revised THP engine, it chugs like a diesel due to carbon buildup and a stretched timing chain which is gradually destroying the engine via knock. My pal is an apprentice at the local dealer and says they regularly have cars in for new engines due to the problems listed above. Mines is a 2011 with 46k. To have everything put right will be nearly 2k, the cars worth 5k ish so I'm kind of set on changing before it ends up worth nout. My young man maths may vary with everyone elses though!
MinuteMan said:
5k buys you a S2000/350Z/330i/Z4, and I bet the depreciation on the Mini + loan interest will exceed the extra insurance/fuel/repair costs of any of the above over the course of 3 years.
And if they're too expensive to run, there's plenty of more interesting cars you can pick up for 5k which won't cost an arm and a leg to keep!
The last thing I would do at 19 is to take out a 10k loan on a car, but that's me
Honestly, see if I could insure any of those I'd jump at the chance. I went and viewed a 200sx but the age put me off, I rely on my car for getting to work and meeting up with mates at the weekend. It probably would be a cheaper alternative, but as an example, I had a rattly exhuast hanger on my car last month which took me 3 weeks to have repaired as I just couldn't be without the car for any real length of time. And if they're too expensive to run, there's plenty of more interesting cars you can pick up for 5k which won't cost an arm and a leg to keep!
The last thing I would do at 19 is to take out a 10k loan on a car, but that's me
How I managed before I had it I don't know...
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