Cost of New Car Vs Used Car. Am i missing anything?
Discussion
firstly sorry for all the questions
Its insurance time, and im looking at quotes
to insure my 110bhp vw bora for a year is £1800
to insure a 105bhp seat ibza / polo / fabia is £1500
so £300 saving there
tax for the bora £220
tax for ibiza £30
saving £190
mot - bora £50 plus what ever repairs cost, so £100 - £200 based on the last 2
ibza - none
I would be buying the ibiza on finance, 1 year old cars are around £11,000, on pcp so hand back at the end and walk away ( if i go to uni)
i no longer need a derv, as my commute has dropped to 5 miles a day, but my bora does 500 miles to a tank costing £79
a ibiza would cost £58 and both claim 55mpg so more like 40mpg on my town and dual carrageway commute, people say they get around 400 miles to a tank
i service my bora every 10k and it costs £70 a time, the ibza will costs about £130 from a main dealer
the new car is covered by warrantee, and although my bora has been reliable it is showing its age, cambelt has been done but its on 120k now.
the finance rate at the moment is £199 down and £199 a month. Which i can afford easily
so for me it seems like a good idea, but what am i missing?
i know you need gap insurance but how much is that?
any other costs i need to worry about? obviously a newer car depreciates, but if its pcp the value doesnt matter at the end if your handing it back?
Is there anything else i should be looking at? I wanted a smaller engine car but with a good amount of power which i think the tsi engines account for
having a diesel just seems like a waste now, covering less than 10k a year apposed to the 18k i covered in my previous job
Its insurance time, and im looking at quotes
to insure my 110bhp vw bora for a year is £1800
to insure a 105bhp seat ibza / polo / fabia is £1500
so £300 saving there
tax for the bora £220
tax for ibiza £30
saving £190
mot - bora £50 plus what ever repairs cost, so £100 - £200 based on the last 2
ibza - none
I would be buying the ibiza on finance, 1 year old cars are around £11,000, on pcp so hand back at the end and walk away ( if i go to uni)
i no longer need a derv, as my commute has dropped to 5 miles a day, but my bora does 500 miles to a tank costing £79
a ibiza would cost £58 and both claim 55mpg so more like 40mpg on my town and dual carrageway commute, people say they get around 400 miles to a tank
i service my bora every 10k and it costs £70 a time, the ibza will costs about £130 from a main dealer
the new car is covered by warrantee, and although my bora has been reliable it is showing its age, cambelt has been done but its on 120k now.
the finance rate at the moment is £199 down and £199 a month. Which i can afford easily
so for me it seems like a good idea, but what am i missing?
i know you need gap insurance but how much is that?
any other costs i need to worry about? obviously a newer car depreciates, but if its pcp the value doesnt matter at the end if your handing it back?
Is there anything else i should be looking at? I wanted a smaller engine car but with a good amount of power which i think the tsi engines account for
having a diesel just seems like a waste now, covering less than 10k a year apposed to the 18k i covered in my previous job
Edited by okie592 on Sunday 15th April 02:40
In your opinion is the Fabia worth 2.4k-running costs of the bora a year? While you may be in a position to easily afford the car now are there other things to consider such as emergencies, property purchases, family and job security that could influence the affordability?
I had my scooby on finance and I will never forget the £200, plus road tax, cambelt service, mot, fuel month. That I experienced cost me 2k in 1 month.
New fabia sounds a lot more sensible than that though.
I had my scooby on finance and I will never forget the £200, plus road tax, cambelt service, mot, fuel month. That I experienced cost me 2k in 1 month.
New fabia sounds a lot more sensible than that though.
not260 said:
In your opinion is the Fabia worth 2.4k-running costs of the bora a year? While you may be in a position to easily afford the car now are there other things to consider such as emergencies, property purchases, family and job security that could influence the affordability?
I had my scooby on finance and I will never forget the £200, plus road tax, cambelt service, mot, fuel month. That I experienced cost me 2k in 1 month.
New fabia sounds a lot more sensible than that though.
only 19, so not planning on buying a house anytime soon. job is secure, unlikely too be made redundant or loose it in the next 18 months - 3 years. I had my scooby on finance and I will never forget the £200, plus road tax, cambelt service, mot, fuel month. That I experienced cost me 2k in 1 month.
New fabia sounds a lot more sensible than that though.
Thats why i was thinking smaller engine, £30 road tax a year is easily afforrdable.
what the scoob new, i assume a car wouldnt need a cambelt in its first 30k i am likely to cover.
oh finance would be via dealer on a dealer car
Nah the scoob was 5 year old and at 60k when it needed the belt service, I should have bought a new one thinking about it.
Since you've mentioned you're 19, when I was 18 I took out a loan to finance a pug 309 gti. I had no plans on buying a house etc at the time so could "easily afford it". When I was 19 I bought my first house (didn't see it coming only a year before) I could still afford both but things were tighter than they might have been otherwise. If I could do it again I probably would but only because the 309 is one of the best fun cars I've ever owned. I don't know if the same could be said for a fabia.
Since you've mentioned you're 19, when I was 18 I took out a loan to finance a pug 309 gti. I had no plans on buying a house etc at the time so could "easily afford it". When I was 19 I bought my first house (didn't see it coming only a year before) I could still afford both but things were tighter than they might have been otherwise. If I could do it again I probably would but only because the 309 is one of the best fun cars I've ever owned. I don't know if the same could be said for a fabia.
A bit o/t but Gap Insurance is an area that mystifies me. I understand that in the case of a claim then you lose the excess but the gap insurance doesn't seem proportionate to what you pay for it. Then you could choose kerbing insurance, dent insurance etc. I've never had any of these and am thoroughly better off for it. It's no secret in the motor trade that it is possible to make more out of back-end sales (finance and insurance products) than front-end (profit on the car sale) Caveat emptor.
Edited by UnderTheRadar on Sunday 15th April 03:03
I do not see the value in GAP at all. Depends who you deal with, but a VRI (vehicle replacement insurance) is much better. Most GAP insuarnce costs about £350, and will only cover the gap between your settlement and your cars value. A VRI will give you the difference between the current value, and what you actually paid. So effectively, if you pay £11,000 for the car, write the car off in year 3, lets say you get £4500 back from insurance, then the VRI would give you a check for £6500 too. This normally only costs £199.
Yes thats a bit of a sales pitch, but its much better thn GAP in my opinion.
Yes thats a bit of a sales pitch, but its much better thn GAP in my opinion.
Emubiker said:
I do not see the value in GAP at all. Depends who you deal with, but a VRI (vehicle replacement insurance) is much better. Most GAP insuarnce costs about £350, and will only cover the gap between your settlement and your cars value. A VRI will give you the difference between the current value, and what you actually paid. So effectively, if you pay £11,000 for the car, write the car off in year 3, lets say you get £4500 back from insurance, then the VRI would give you a check for £6500 too. This normally only costs £199.
Yes thats a bit of a sales pitch, but its much better thn GAP in my opinion.
if its only £200 thats not a problem i was expecting it to be like £100 a month or something, Bonus!Yes thats a bit of a sales pitch, but its much better thn GAP in my opinion.
went to look at a ibiza today really nice, is there still anything im forgeting?
okie592 said:
went to look at a ibiza today really nice, is there still anything im forgeting?
Still trying to determine whether depreciation has been factored in the above posts - this it typically the largest cost of a new car. If you walk away at the end of the term, you have spent £200/month for 3 years and at the end, you will have nothing.Fox- said:
£200 a month on a base model Ibiza? This is something you'll look back on and think 'Why did I do that?' I would imagine.
its a sport or a copa so mid range. being 19 the FR and cupra are off limits for at least another year.not sure if depreciation matters with finance, i dont plan to buy the car outright, just return it at the end of the term and either get another one, or return to private owned cars, something i can do putting money aside each months for saving as ive been doing the last couple of years, when insurance has been more
The thing that us oldies (I'm 30) forget is that it is easy to have high disposable income.
For instance, the OP could:
Live at home...may pay no rent and have food etc provided (this is not uncommon).
Spend a lot of time driving about...we've all been there when younger.
Not have expensive habits...when I was 19 I had yet to develop a taste for Champagne every weekend...nights out are cheap and often pegged to the lowest income in the group.
Not have women expecting dinner at the Ivy or wherever.
No kids or other dependants.
We also know nothing about his income. He could fit every criteria above and have £2k disposable each month....we shouldn't judge.
The only thing the OP needs to think about is will he still want to drive the car in 2 years time? I suspect he will want something much nicer/faster.
For instance, the OP could:
Live at home...may pay no rent and have food etc provided (this is not uncommon).
Spend a lot of time driving about...we've all been there when younger.
Not have expensive habits...when I was 19 I had yet to develop a taste for Champagne every weekend...nights out are cheap and often pegged to the lowest income in the group.
Not have women expecting dinner at the Ivy or wherever.
No kids or other dependants.
We also know nothing about his income. He could fit every criteria above and have £2k disposable each month....we shouldn't judge.
The only thing the OP needs to think about is will he still want to drive the car in 2 years time? I suspect he will want something much nicer/faster.
okie592 said:
its a sport or a copa so mid range. being 19 the FR and cupra are off limits for at least another year.
not sure if depreciation matters with finance, i dont plan to buy the car outright, just return it at the end of the term and either get another one, or return to private owned cars, something i can do putting money aside each months for saving as ive been doing the last couple of years, when insurance has been more
Of course depreciation matters - its what sets the finance rate. You are paying the depreciation on the car, but on a monthly basis with a bit of profit for the finance company added in.not sure if depreciation matters with finance, i dont plan to buy the car outright, just return it at the end of the term and either get another one, or return to private owned cars, something i can do putting money aside each months for saving as ive been doing the last couple of years, when insurance has been more
Emubiker said:
I do not see the value in GAP at all. Depends who you deal with, but a VRI (vehicle replacement insurance) is much better. Most GAP insuarnce costs about £350, and will only cover the gap between your settlement and your cars value. A VRI will give you the difference between the current value, and what you actually paid.
There are two types of "GAP" insurance: "Finance GAP", which does indeed pay any shortfall between your insurance payout and finance settlement and there is "Invoice GAP" (or "RTI - Return To Invoice" cover). which does as per your "VRI". Same thing, different nomenclature. Given that where both are available, the payouts are smaller for Finance GAP than Invoice GAP, it is Finance GAP that carries the lower initial premium. In terms of cost vs. payout, bear in mind that your motor insurance usually costs more than £350 per year. Renewals almost invariably seem to cost more if you stick with one insurer throughout. Also, their total liability in the event of a write-off/total loss also decreases in line with depreciation.
A customer who finances can choose either cover, a cash buyer only RTI, obviously. If I were financing, I'd still have RTI as in the event of a write-off/total loss, noy only would my finance be settled, I'd have a pile of cash too. Most dealers now offer only full return-to-invoice shortfall insurance.
It's worth having at the right premium. Source it yourself, rather than taking the dealer's product - it'll cost half as much or less as the difference is dealer commission that you're not then paying.
For instance:
http://www.shortfallcover.co.uk/
http://www.quotiva.co.uk/insurance/gap/shortfall-c...
https://www.gapinsurance123.co.uk/gapinsurance.htm...
Etc.
I'm not affiliated with any of those companies BTW, but have sold shortfall insurance from dealerships for many years and have bought said cover for our own cars in the past, direct from the providers.
Fox- said:
Of course depreciation matters - its what sets the finance rate. You are paying the depreciation on the car, but on a monthly basis with a bit of profit for the finance company added in.
Yep. I view PCP as a deal whereby you get to pay for someone else's depreciation in return for getting to use the car for a couple of years (assuming, of course, that you don't keep the car afterwards). But then I am a bit tight about that kind of thing
AlpineWhite said:
Yep. I view PCP as a deal whereby you get to pay for someone else's depreciation in return for getting to use the car for a couple of years (assuming, of course, that you don't keep the car afterwards).
But then I am a bit tight about that kind of thing
I understand that and its something im prepared for, its basic like renting the car, il never own it, but thats fine, ive owned old cars and now want a new one.But then I am a bit tight about that kind of thing
the plan is to keep it until in 21, which is a year away, then either get out of the agreement and buy a cheap car again or upgrade to something else. world of cars and free insurance opens up at 21.
For those doubting i can afford it, im 19 live at home, pay no rent, work full time and after bills have a disposable income of about £800 a month, till now i have been saving a large portion of that a month but why should i waste my life saving for a rainy day that might never come.
okie592 said:
For those doubting i can afford it, im 19 live at home, pay no rent, work full time and after bills have a disposable income of about £800 a month, till now i have been saving a large portion of that a month but why should i waste my life saving for a rainy day that might never come.
Because it will - one day you won't have those things. If you've got a huge pile of cash saved through not renting an appliance, you'll have money to still buy niec things once you've got boring things to pay for.I get spending money on something great but a leased Seat Ibiza? It just seems like some sort of generic A to B car. Which is fine if you need that and its sensible to pay for that but if you are going to spend £200+ a month running a car at least make it something you'll look back on and not think 'yea, that wasn't worth it'.
Fox- said:
I get spending money on something great but a leased Seat Ibiza? It just seems like some sort of generic A to B car. Which is fine if you need that and its sensible to pay for that but if you are going to spend £200+ a month running a car at least make it something you'll look back on and not think 'yea, that wasn't worth it'.
OP, see here - one month of your savings: http://www.pistonheads.com/news/default.asp?storyI...
OK insurance and VED might be a bit more, but you'll not be tied into any financial commitment and should see most of your cash back a year hence. Or keep your Bora for another year and then have a chunk of savings to buy something more interesting a year from now once you know what you're doing next regards work/study/life in general.
okie592 said:
I understand that and its something im prepared for, its basic like renting the car, il never own it, but thats fine, ive owned old cars and now want a new one.
the plan is to keep it until in 21, which is a year away, then either get out of the agreement and buy a cheap car again or upgrade to something else. world of cars and free insurance opens up at 21.
For those doubting i can afford it, im 19 live at home, pay no rent, work full time and after bills have a disposable income of about £800 a month, till now i have been saving a large portion of that a month but why should i waste my life saving for a rainy day that might never come.
Would have thought you would be taking a bath on getting out of the PCP early? There's no GFV and you will have taken the largest hist in the first 12 month son the depreciation curve... Can't you soldier on for another 12 months in the bora putting money away for Just in Case or hopefully a meatier deposit on someting nice when you are 21...the plan is to keep it until in 21, which is a year away, then either get out of the agreement and buy a cheap car again or upgrade to something else. world of cars and free insurance opens up at 21.
For those doubting i can afford it, im 19 live at home, pay no rent, work full time and after bills have a disposable income of about £800 a month, till now i have been saving a large portion of that a month but why should i waste my life saving for a rainy day that might never come.
You said you had heavily reduced your daily mileage.. the bora will keep going on that mileage?
I do understand the lure of fresh metal, but in 12 months time I can see it when you come back to PX the ibiza and they ask you to bend over smartly...
Simes
Gassing Station | General Gassing | Top of Page | What's New | My Stuff