£750 per month for a 911 - Can I do it?
Discussion
I'm thinking of getting a 911, the problem is my annual mileage which is about 40k per year.
My budget is £750/month but this needs to cover loan to purchase, servicing, and wear and tear items such as brake pads/tyres.
Due to my mileage I need something reliable and I will probably keep it for 3 years.
Anyone any advice on doing this, or is it a pipe dream on this budget with this mileage?
My budget is £750/month but this needs to cover loan to purchase, servicing, and wear and tear items such as brake pads/tyres.
Due to my mileage I need something reliable and I will probably keep it for 3 years.
Anyone any advice on doing this, or is it a pipe dream on this budget with this mileage?
leeme3 said:
How old a car are you looking for and how much deposit can you put down?
You can always do it with that sort of money per month, but you're going to lose a lot to depreciation if you get something relatively new (996 or later).
No deposit. In terms of age I don't think I would go any more than 3 years old due to the mileage I would then put on it over the next 3 years i.e. 120k.
Don't care about depreciation on my mileage its pretty worthless whatever I get.
Might be worth getting in touch with these guys:
Classic & Sports Finance
www.classicandsportsfinance.com
Rob is the guy I dealt with and I was really pleased with their product and knowledge of the market. A lot of their business is finance for 911 purchase and they give realistic future values and can cope with low/no deposit.
If you tell them how much you want to spend and for how long etc etc they'll tell you what your budget is.
No affiliation etc etc etc
Classic & Sports Finance
www.classicandsportsfinance.com
Rob is the guy I dealt with and I was really pleased with their product and knowledge of the market. A lot of their business is finance for 911 purchase and they give realistic future values and can cope with low/no deposit.
If you tell them how much you want to spend and for how long etc etc they'll tell you what your budget is.
No affiliation etc etc etc
OK, I've had a think about this, but I've also been to someone's leaving drinks, so ... pinch of salt may be required ... I don't see how this can work, if all you can spend is what you can borrow.
Rationale as follows:
Assuming you really want a car less than 3 years old, that means a 996, and that means a warranty in case something catastrophic goes wrong.
At 40K miles a year you'll need (at least) 2 sets of tyres a year, that must be £1,500 alone, so allow £3,000/year on servicing and consumables?
So £750/month breaks down as follows:
£15k over 36 months at 6.4% = 458.10/month (no payment protection, from Lloyds TSB)
Warranty at £750/yr = 62.50/month
Servicing and consumables at £3K/yr = 250/month
Total = £770.60/month
So far so good, BUT you've only got 15K to spend, and that isn't a 996 (yet) - maybe a 964 if you're lucky.
Obviously you can probably better that loan rate, but it'll merely be tweaking it won't change the fundamentals.
Alternatively ditching the warranty (and the 996) would permit:
£17k over 36 months at 6.4% = 519.18/month (no payment protection, from Lloyds TSB)
Servicing at £3K/yr = 250.00/month
Total = £769.18
Can't make it add up. Maybe one fo the finance houses as previously suggested can help, as they will presumably assign a residual value to the car.
Alternatively what about a 968 or a Boxster?
Dan
Rationale as follows:
Assuming you really want a car less than 3 years old, that means a 996, and that means a warranty in case something catastrophic goes wrong.
At 40K miles a year you'll need (at least) 2 sets of tyres a year, that must be £1,500 alone, so allow £3,000/year on servicing and consumables?
So £750/month breaks down as follows:
£15k over 36 months at 6.4% = 458.10/month (no payment protection, from Lloyds TSB)
Warranty at £750/yr = 62.50/month
Servicing and consumables at £3K/yr = 250/month
Total = £770.60/month
So far so good, BUT you've only got 15K to spend, and that isn't a 996 (yet) - maybe a 964 if you're lucky.
Obviously you can probably better that loan rate, but it'll merely be tweaking it won't change the fundamentals.
Alternatively ditching the warranty (and the 996) would permit:
£17k over 36 months at 6.4% = 519.18/month (no payment protection, from Lloyds TSB)
Servicing at £3K/yr = 250.00/month
Total = £769.18
Can't make it add up. Maybe one fo the finance houses as previously suggested can help, as they will presumably assign a residual value to the car.
Alternatively what about a 968 or a Boxster?
Dan
Dan,
Thanks for this. I've been doing these sums as well and I agree. As you say unless someone would do a PCP on a 3 year old 996 and give a decent residual value on it, I can't finance it. The problem is no one is going to give any sort of residual on a 150k mile 996!!
I don't want a Boxster and i'll be honest I don't want go below a 996. I think my only way would be to add the car to the mortgage (please don't tell the wife) that way I reckon I can raise 40k for the car (Low Mileage 2002 Carrera S) for an increased mortgage payment of £250. £500 per month then will cover everything else easily.
Thanks for this. I've been doing these sums as well and I agree. As you say unless someone would do a PCP on a 3 year old 996 and give a decent residual value on it, I can't finance it. The problem is no one is going to give any sort of residual on a 150k mile 996!!
I don't want a Boxster and i'll be honest I don't want go below a 996. I think my only way would be to add the car to the mortgage (please don't tell the wife) that way I reckon I can raise 40k for the car (Low Mileage 2002 Carrera S) for an increased mortgage payment of £250. £500 per month then will cover everything else easily.
Dan
you are assuming that the £15k he can afford to borrow using your analysis is to purchase the full value of any proposed vehicle. He only needs to finance the depreciation really. The problem is a 3 year finance deal will at best give your a 40% residual, much lower if he's doing 40k miles per year. So, A £40k car will be value to have a RV of £16k in 3 years. Already, he's financing £24k, not including the cost of the money.
A dilemma indeed, if you want to drive a 911 40k miles a year.
I'd find a nice, mid miles 964 for £17k, though they cost more to service than a 993, they are much cheaper at the moment.
you are assuming that the £15k he can afford to borrow using your analysis is to purchase the full value of any proposed vehicle. He only needs to finance the depreciation really. The problem is a 3 year finance deal will at best give your a 40% residual, much lower if he's doing 40k miles per year. So, A £40k car will be value to have a RV of £16k in 3 years. Already, he's financing £24k, not including the cost of the money.
A dilemma indeed, if you want to drive a 911 40k miles a year.
I'd find a nice, mid miles 964 for £17k, though they cost more to service than a 993, they are much cheaper at the moment.
I must admit that I was assuming you could put a couple of k in for a deposit and that you'd consider a Porsche 993, which would wear the miles well and be a bit cheaper.
Say a 993 with 60k miles costs 23k. Put down 3k. The residual is say 6k, so that leaves you to finance 14k. The 14k should cost about 350 GBP a month, leaving 400 GBP for the rest. Don't worry about a warranty; 993 engines and boxes are around in dismantlers if the worst happens.
But basically, I can't see you financing the whole 25k and running it for 750 GBP. Maybe financing part of the money and running it. It may work if you got a 15k 964 or 3.2 that's been well cared for... again, don't get the warranty and just save 400 a month for stuff going wrong. 40k a year is a lot of miles and a lot of wear and tear.
rgds
domster
Say a 993 with 60k miles costs 23k. Put down 3k. The residual is say 6k, so that leaves you to finance 14k. The 14k should cost about 350 GBP a month, leaving 400 GBP for the rest. Don't worry about a warranty; 993 engines and boxes are around in dismantlers if the worst happens.
But basically, I can't see you financing the whole 25k and running it for 750 GBP. Maybe financing part of the money and running it. It may work if you got a 15k 964 or 3.2 that's been well cared for... again, don't get the warranty and just save 400 a month for stuff going wrong. 40k a year is a lot of miles and a lot of wear and tear.
rgds
domster
simonharrod911 said:
Dan,
£500 per month then will cover everything else easily.
It won't cover the depreciation Steve.
I'm not worried about depreciation. I'm treating the owning of the car like a lease, anything left in the value of the car at the end, over and above what i may still owe on the finance is a bonus.
johnfm said:
The problem is a 3 year finance deal will at best give your a 40% residual, much lower if he's doing 40k miles per year. So, A £40k car will be value to have a RV of £16k in 3 years. .
John, don't disagree with your sentiments but surely you wouldn't apply this sort of a residual drop in a used car which has lost 40% of it's value already?? Realistic value for a '98 996 are about £25k at the moment. Apart from the mileage in this particular case I can't see a '02 facelift car being worth £16k in 2008??
Jimbo
My figures were by way of example - its Friday and I'm not a car financier! I agree with you though, the RV of a car that's already dropped 40% will be tuppence hapenny!
I suppose at the end of the day, you just can't run a 996, doing that sort of mileage, with no deposit and £750/month. Don't want to piss on your parade, but maybe you just can't afford it right now.
Adding to the mortgage just phenomonally increases the cost of the car, as though its 'just' £250 a month to the mortgage, its over 20+ years. That being said, you are then paying £250/month to buy a heavily depreciating 'asset'. Just don't tell the wife!!
My figures were by way of example - its Friday and I'm not a car financier! I agree with you though, the RV of a car that's already dropped 40% will be tuppence hapenny!
I suppose at the end of the day, you just can't run a 996, doing that sort of mileage, with no deposit and £750/month. Don't want to piss on your parade, but maybe you just can't afford it right now.
Adding to the mortgage just phenomonally increases the cost of the car, as though its 'just' £250 a month to the mortgage, its over 20+ years. That being said, you are then paying £250/month to buy a heavily depreciating 'asset'. Just don't tell the wife!!
Yep, with you there. I financed one car through mortgage equity and I never paid it back and I don't suppose many others do!
End of the day these cars are not exactly cheap to run and if you are really tight on budget already maybe consider something else for the time being! After all there are a lot of fun cars out there to be experienced!!
End of the day these cars are not exactly cheap to run and if you are really tight on budget already maybe consider something else for the time being! After all there are a lot of fun cars out there to be experienced!!
I have sunk what little £££ I have into Total911 Magazine and a property. I expect the property to mature next year. I hope Total911 will continue to grow over the next 3-5 years. I then want the pleasure of speccing my car and writing a cheque, knowing that I really have made sacrifices and taken risks to get it.
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