How do most people finance their Ferrari, lambo or other?
Discussion
How do most people finance their Ferrari, lambo or other? Without nescessarily getting into how much you paid for a car / pay a month etc. What sort of finance rates are we talking about for the 70-120k we are looking at for a ferrari or lambo? and do people normally take the finance with a large baloon payment at the end & hope the car is worth enough to pay it off? At the moment I'm losely considering a 360 F1 or ideally a gallardo but I'm struggling with the bravery needed to pay house price figures for a car which could be worth a fraction of what I paid for it. I'm only really looking to own & run on for 12-18 months.
so, what have people done?
Cheers,
A
fade2greyuk at hotmail
so, what have people done?
Cheers,
A
fade2greyuk at hotmail
Sorry to piss on your parade but IMHO I think you are mad to finance a car of this type/price range. The finance is unlikely to keep up with the relative depreciation curve and you will spend more time worrying about paying for it (and running it) than actually enjoying it. The only exception to this is if you are able to make the car "earn it's keep" in some way to offset the cost.
The general view is that it's madness to finance a depreciating asset - if you can, buy it cash on the nail!
dealmaker said:
The general view is that it's madness to finance a depreciating asset - if you can, buy it cash on the nail!
Could not agree more. Either save up a little longer until you have the cash to buy it or don't bother and buy something cheaper. If you don't think you will ever be able to buy it outright why take on the financial white elephant.Hire one once a month, it will be cheaper.
Edited by lsb on Friday 3rd November 18:18
dealmaker said:
Sorry to piss on your parade but IMHO I think you are mad to finance a car of this type/price range. The finance is unlikely to keep up with the relative depreciation curve and you will spend more time worrying about paying for it (and running it) than actually enjoying it. The only exception to this is if you are able to make the car "earn it's keep" in some way to offset the cost.
The general view is that it's madness to finance a depreciating asset - if you can, buy it cash on the nail!
How many people in the real world pay cash for a car? Must be close to 90% of buyers who use finance, be it for a Corsa or a Ferrari. There is one of those gigantic car warehouse type places near here, you have to search to find the price of the car as the number in big letters is the monthly payment.
dealmaker said:
Sorry to piss on your parade but IMHO I think you are mad to finance a car of this type/price range. The finance is unlikely to keep up with the relative depreciation curve and you will spend more time worrying about paying for it (and running it) than actually enjoying it. The only exception to this is if you are able to make the car "earn it's keep" in some way to offset the cost.
The general view is that it's madness to finance a depreciating asset - if you can, buy it cash on the nail!
Sorry dealmaker, have to strongly disagree with you. If you've got 100K cash that you can invest in a business and get say 10% return on (which is not unrealistic) and you can borrow money at say 5ish% percent, then it makes very good business sense to do it. Taking aside the depreciation, (that's another story)most people with these kind of cars purchase them on finance. Even the guys who are multi millionaire's do it according to the guys at Lambo Manch, so it must be viable.
Andy.
cummingsa said:
Even the guys who are multi millionaire's do it according to the guys at Lambo Manch, so it must be viable.
I recall an autocar article a couple of years ago where they went around to some exotica showrooms and looked at the finance details. iirc they said that most people tended to purchase on finance.
I've also read/heard somewhere that many people put down £10K on a new ferarri, pay low payments and then sell the car to settle the balloon.
angelis said:
cummingsa said:
Even the guys who are multi millionaire's do it according to the guys at Lambo Manch, so it must be viable.
I recall an autocar article a couple of years ago where they went around to some exotica showrooms and looked at the finance details. iirc they said that most people tended to purchase on finance.
I've also read/heard somewhere that many people put down £10K on a new ferarri, pay low payments and then sell the car to settle the balloon.
Also, a lot of younger people have a high income but don't have 70-80k cash to hand. If you REALLY want that car, you'd finance the purchase rather than saving for it for 2 years then buying it for cash.
cummingsa said:
dealmaker said:
Sorry to piss on your parade but IMHO I think you are mad to finance a car of this type/price range. The finance is unlikely to keep up with the relative depreciation curve and you will spend more time worrying about paying for it (and running it) than actually enjoying it. The only exception to this is if you are able to make the car "earn it's keep" in some way to offset the cost.
The general view is that it's madness to finance a depreciating asset - if you can, buy it cash on the nail!
Sorry dealmaker, have to strongly disagree with you. If you've got 100K cash that you can invest in a business and get say 10% return on (which is not unrealistic) and you can borrow money at say 5ish% percent, then it makes very good business sense to do it. Taking aside the depreciation, (that's another story)most people with these kind of cars purchase them on finance. Even the guys who are multi millionaire's do it according to the guys at Lambo Manch, so it must be viable.
Andy.
Andy,
I can see your point but your argument is fundamentally flawed - you are assuming the orginal poster HAS the £100k (maybe he has - but I'd not interpreted it that way) - on that assumption, and on the basis that you have other business interest(s), that give you a better ROCE, then you WOULD be better borrowing the money.
However if you don't have the cash in the first place, your better off forgetting the finance (or buying a cheaper car) and focussing your efforts on making enough money to be in the position to decide which way to go! Borrowing money you don't have, to fund a finance company, and a car you can't really afford is madness.
I doubt many of your "multi millionaire's" set off on a path of becoming that way by leveraging all their income against a flash car!
Edited by dealmaker on Friday 3rd November 19:09
dealmaker said:
Andy,
I can see your point but your argument is fundamentally flawed - you are assuming the orginal poster HAS the £100k (maybe he has - but I'd not interpreted it that way) - on that assumption, and on the basis that you have other business interest(s), that give you a better ROCE, then you WOULD be better borrowing the money.
However if you don't have the cash in the first place, your better off forgetting the finance (or buying a cheaper car) and focussing your efforts on making enough money to be in the position to decide which way to go! Borrowing money you don't have, to fund a finance company, and a car you can't really afford is madness.
I doubt many of your "multi millionaire's" set off on a path of becoming that way by leveraging all their income against a flash car!
I can see your point but your argument is fundamentally flawed - you are assuming the orginal poster HAS the £100k (maybe he has - but I'd not interpreted it that way) - on that assumption, and on the basis that you have other business interest(s), that give you a better ROCE, then you WOULD be better borrowing the money.
However if you don't have the cash in the first place, your better off forgetting the finance (or buying a cheaper car) and focussing your efforts on making enough money to be in the position to decide which way to go! Borrowing money you don't have, to fund a finance company, and a car you can't really afford is madness.
I doubt many of your "multi millionaire's" set off on a path of becoming that way by leveraging all their income against a flash car!
Edited by dealmaker on Friday 3rd November 19:09
Finance is a means to an end, it may not make perfect sense but we're talking about fulfilling a dream here, not the rational thought that goes into doing your weekly shopping. For the vast majority of people (me included), I know I can save 20 - 30K and afford repayments on the likes of a 360/Diablo with enough money to cover insurance and running costs now rather than waiting another 3 - 4 years..... Ok so I lose money and I've paid the Finance Company interest but that's the price I'm willing to pay and I suggest I'm not alone by any means....
ahaughton said:
dealmaker said:
Andy,
I can see your point but your argument is fundamentally flawed - you are assuming the orginal poster HAS the £100k (maybe he has - but I'd not interpreted it that way) - on that assumption, and on the basis that you have other business interest(s), that give you a better ROCE, then you WOULD be better borrowing the money.
However if you don't have the cash in the first place, your better off forgetting the finance (or buying a cheaper car) and focussing your efforts on making enough money to be in the position to decide which way to go! Borrowing money you don't have, to fund a finance company, and a car you can't really afford is madness.
I doubt many of your "multi millionaire's" set off on a path of becoming that way by leveraging all their income against a flash car!
I can see your point but your argument is fundamentally flawed - you are assuming the orginal poster HAS the £100k (maybe he has - but I'd not interpreted it that way) - on that assumption, and on the basis that you have other business interest(s), that give you a better ROCE, then you WOULD be better borrowing the money.
However if you don't have the cash in the first place, your better off forgetting the finance (or buying a cheaper car) and focussing your efforts on making enough money to be in the position to decide which way to go! Borrowing money you don't have, to fund a finance company, and a car you can't really afford is madness.
I doubt many of your "multi millionaire's" set off on a path of becoming that way by leveraging all their income against a flash car!
Edited by dealmaker on Friday 3rd November 19:09
Finance is a means to an end, it may not make perfect sense but we're talking about fulfilling a dream here, not the rational thought that goes into doing your weekly shopping. For the vast majority of people (me included), I know I can save 20 - 30K and afford repayments on the likes of a 360/Diablo with enough money to cover insurance and running costs now rather than waiting another 3 - 4 years..... Ok so I lose money and I've paid the Finance Company interest but that's the price I'm willing to pay and I suggest I'm not alone by any means....
I don't doub't it - and I'm the LAST one to decry anyone for attempting to rationalise their purchase and indeed passion (I spend a huge amount of time attempting to rationalise my purchases with the wife..."why do you need ANOTHER two seater?".....), and where pertinent I have used finance - my point is simply that there isn't a sound financial argument in doing so unless you have the money and indeed a better home for it! Bt hey....if it's the ONLY way you are going to be able to afford a slice of your lifelong passion ...go for it.....I just feel your efforts would be best expended utilising those funds to create wealth which will allow you to afford the car of your dreams! Just my 2c!
dealmaker said:
I don't doub't it - and I'm the LAST one to decry anyone for attempting to rationalise their purchase and indeed passion (I spend a huge amount of time attempting to rationalise my purchases with the wife..."why do you need ANOTHER two seater?".....), and where pertinent I have used finance - my point is simply that there isn't a sound financial argument in doing so unless you have the money and indeed a better home for it! Bt hey....if it's the ONLY way you are going to be able to afford a slice of your lifelong passion ...go for it.....I just feel your efforts would be best expended utilising those funds to create wealth which will allow you to afford the car of your dreams! Just my 2c!
Fair point
Good to see some constructive debate on the finance/cash side of things 
For me (trying partially to rationalise things) I'm in a lucky position where virtually all of my income is disposable, I can put a chunk of cash down (20k+) & have the money to meet the payments & running costs of the car - within reason, obviously. I'm unlikely to be in this position for more than a couple of years & will eventually have to bit the bullett & upsize, settle down, kids etc etc & I'll be 50 before I could afford to consider it again!
So for those who did use the dreaded tick, how did you do it?
I'll start another post about daily running of a 360 f1/manual to keep things on topic.
PS - was surprised to see insurance was more reasonable than I'd expected lol.
For me (trying partially to rationalise things) I'm in a lucky position where virtually all of my income is disposable, I can put a chunk of cash down (20k+) & have the money to meet the payments & running costs of the car - within reason, obviously. I'm unlikely to be in this position for more than a couple of years & will eventually have to bit the bullett & upsize, settle down, kids etc etc & I'll be 50 before I could afford to consider it again!
So for those who did use the dreaded tick, how did you do it?
I'll start another post about daily running of a 360 f1/manual to keep things on topic.
PS - was surprised to see insurance was more reasonable than I'd expected lol.
fade2grey said:
Good to see some constructive debate on the finance/cash side of things
For me (trying partially to rationalise things) I'm in a lucky position where virtually all of my income is disposable, I can put a chunk of cash down (20k+) & have the money to meet the payments & running costs of the car - within reason, obviously. I'm unlikely to be in this position for more than a couple of years & will eventually have to bit the bullett & upsize, settle down, kids etc etc & I'll be 50 before I could afford to consider it again!
So for those who did use the dreaded tick, how did you do it?
I'll start another post about daily running of a 360 f1/manual to keep things on topic.
PS - was surprised to see insurance was more reasonable than I'd expected lol.
For me (trying partially to rationalise things) I'm in a lucky position where virtually all of my income is disposable, I can put a chunk of cash down (20k+) & have the money to meet the payments & running costs of the car - within reason, obviously. I'm unlikely to be in this position for more than a couple of years & will eventually have to bit the bullett & upsize, settle down, kids etc etc & I'll be 50 before I could afford to consider it again!
So for those who did use the dreaded tick, how did you do it?
I'll start another post about daily running of a 360 f1/manual to keep things on topic.
PS - was surprised to see insurance was more reasonable than I'd expected lol.
Hang On just one minute!!!
OK so if you ARE going to hock yourself up at least make it WORTH it!.....don't get a tarted up Celica/Daewoo lookalikee !!!!..........get a real supercar....a Lambo!!
fade2grey said:
I'm unlikely to be in this position for more than a couple of years & will eventually have to bit the bullett & upsize, settle down, kids etc etc & I'll be 50 before I could afford to consider it again!
I think that's the key point here. You may only have a couple of years open to fulfil your dream. Once wife and kiddies are on the scene it's hard enough to hang onto a decent car, as for going out and buying one...
Also you'll get 10 times more pleasure now than you will when your 50 - and thats provided the opportunity is there when you're 50.
If you're hellbent on a 70k+ car then go and get it - but you could save yourself a stack of cash by getting a 355...
Edited by andy 308gtb on Friday 3rd November 21:42
Don't believe you should ever borrow money you don't have to fund one of these. They do nothing tangible which something at a fraction of the price can't do, so you don't have that arguement. You are buying for what it IS rather than what it can do (I write as a multiple offender)
And unless you're wired up a little strangely, it's hard to feel good about 'ownership' when you're burning money you don't have, and you know you're 'faking it'.
IMO Lambo's/Ferraris are great to own, but only when you truely own them and when they are a mark of what you've achieved.
On the other hand, if you're 25 and footloose and want to attract ladies of flexible morals, you may make a case which I'd find hard to contest.
And unless you're wired up a little strangely, it's hard to feel good about 'ownership' when you're burning money you don't have, and you know you're 'faking it'.
IMO Lambo's/Ferraris are great to own, but only when you truely own them and when they are a mark of what you've achieved.
On the other hand, if you're 25 and footloose and want to attract ladies of flexible morals, you may make a case which I'd find hard to contest.
fade2grey said:
For me (trying partially to rationalise things) I'm in a lucky position where virtually all of my income is disposable, I can put a chunk of cash down (20k+) & have the money to meet the payments & running costs of the car - within reason, obviously. I'm unlikely to be in this position for more than a couple of years & will eventually have to bit the bullett & upsize, settle down, kids etc etc & I'll be 50 before I could afford to consider it again!
So for those who did use the dreaded tick, how did you do it?
Have to say I disagree with lots of the posts in this thread. Of course it's nice if you've got £100k+ in cash to drop on a car but for many of us with families etc. that's never going to happen as there are always competing demands for the dosh! So for those who did use the dreaded tick, how did you do it?
I'm prepared to spend about £1k a month on financing my car, to save up for my 360 Spider would have taken me over 8 years assuming I didn't spend any of that £1k on financing a cheaper car in the meantime. Sorry guys but life's too short, 3 of the guys I was in Uni with were dead before I was 30.
Buying my car on finance costs me an additional £400 or so per month in interest, I consider that a price well worth paying for the pleasure I get from having the car. It's peanuts compared to what a lot of people are paying for mortgages - and whether it's a depreciating or appreciating asset is largely irrelevant, if you're shelling out money on interest you're losing it no matter what.
It's easy enough to work out the finance figures for yourself, you'll currently be able to get 6.75% from most major lenders (including Ferrari Finance if you push them, but they're still more expensive as they'll penalise you for early settlement). I'd recommend you speak to Rob Johnson at Classic & Sports Finance, no connection other than as a satisfied client.
Basically you'll need a minimum 10% deposit and they'll allow you a balloon of just over 50% after 4 years. Your interest will be one twelfth of 6.75% of the outstanding balance every month, the rest of your monthly payment goes towards reducing the balance. As the term progresses and the balance decreases the interest portion of your monthly payment decreases and the repayment increases.
Cheers bobm, it sounds like my position is similar to yours. I don't mind spending 1-1.5k/month on the car & am happy to effectively write it off as the pain for the pleasure of owning and Uber car. Though I do have trouble drawing the line, I'd love a Murcie & at 6'7 I can just about fit in them, but at 120k it's stretching too far. Also from what I read lambo's are much more likely to unhappy being used as a potential daily driver.
I'm aware it's going to depreciate & really my big concern is that I'm not trapped into such an expensive loan when the car is worthless & unable to sell. It's not a risk that will go away, but one I'd like to minimise by buying the right car/condition/miles etc
I'd love to have 100k cash to sink into a car, but I suspect I wouldn't do it by the time I had the cash in the bank. I've always loved the supercar dream & I've got a couple of years before my 30th & figure I'll get a whole lot more use & enjoyment out of the car than when I'm 50.
I have to say that the argument of "if you don't have 100k in the bank then you shouldn't be even considering a <insert brand here> doesn't really hold water for me. Sure it would be nice, but finance is a tool to achieve your dream. At the end of the day people are willing to throw away different amounts of cash for their goals, for me the line is at 1500/month for others it could be more or less.
And as bobm says, it'll actually save me the costs of running the s4 compared with if I was saving up I guess the wierdest thing so far is that my girlfriend thinks it's a great idea & is of the do it while you can persuasion!
I'm aware it's going to depreciate & really my big concern is that I'm not trapped into such an expensive loan when the car is worthless & unable to sell. It's not a risk that will go away, but one I'd like to minimise by buying the right car/condition/miles etc
I'd love to have 100k cash to sink into a car, but I suspect I wouldn't do it by the time I had the cash in the bank. I've always loved the supercar dream & I've got a couple of years before my 30th & figure I'll get a whole lot more use & enjoyment out of the car than when I'm 50.
I have to say that the argument of "if you don't have 100k in the bank then you shouldn't be even considering a <insert brand here> doesn't really hold water for me. Sure it would be nice, but finance is a tool to achieve your dream. At the end of the day people are willing to throw away different amounts of cash for their goals, for me the line is at 1500/month for others it could be more or less.
And as bobm says, it'll actually save me the costs of running the s4 compared with if I was saving up
I guess the wierdest thing so far is that my girlfriend thinks it's a great idea & is of the do it while you can persuasion! Gassing Station | Supercar General | Top of Page | What's New | My Stuff