Car finance

[TimoMak]

Hi All, I am looking at upgrading my car as it is getting quite costly to maintain now at over 100k miles. All my family are very old fashioned as far as their attitude to taking on debt, and especially don't like car finance. I take a more balanced view, as the deals now on a new M2 say can be around £500 a month which seems like a bargain for such a quick car, also new and under warranty would be great after all the £££s I've been spending on repairs.

Is this a financially stupid move though and should I be looking for something much cheaper and 2nd hand that I can buy outright with my 10k deposit money ? Just seems like a minimal (comparitively) monthly cost to have an awesome fast new car on the drive, and all very accessible too at a low APR ! Am I missing something ? I get I don't own it at the end, but my current car is costing me so much I'd far rather just be able to hand it back and get a newer one.

Thanks for your help.

[Montybaber]

Most (if not all) of your replies will advise you to avoid finance at all costs, if you understand what you are taking on (including the pitfalls) then make the decision that is right for you

[mholt1995]

Usual questions...

Are you spending £6k a year maintaining your current car?

Do you realise that you won't get that 10k (and many of your 500pm payments) back if you buy an M2?

Have you thought about the middle ground and getting something in the 15k range? (10k deposit plus 5k loan) - something purchased sensibly should net you most of your deposit back after 3 years+

And then of course the option of getting something for £10k and putting that 500pm into a repairs fund, do what you wish with whatever you have left after hitting 3 grand in the fund

[bangarang]

10K can buy you a decent car which won't be tallying up monthly costs quite as much as your current one (you'd hope!). Have you considered costs on top of the £500 monthly payments or are they included in that price? New car will need servicing, maintenance and so on just like any other car, even if you do have the benefit of it being under warranty this won't cover a lot of "wear and tear" issues like tyres etc.

[Jamescrs]

No one can really advise you on what £500 each month means to you, we don't know your income and what's disposable etc.

To me.peraonally dropping that every month on a car seems a lot but you may earn far more than me and/ or not have two kids to support, I think you will get where I'm coming from

[VAGLover]

Yawn. Give more detail

[Denno B]

Some people don’t think twice about chucking £500 a month on booze, cigs and nights out but would most likely think that amount on a car is a waste of money. Each to their own.

If it is well within your means and you fully understand the financial agreement then I see no reason why not to go for it, you only live once.

[67Dino]

It may look like ‘just’ £500 for the monthly payments, but compared to buying a second hand car for £10k you are probably spending around £15-20k extra in depreciation and around £10k in finance (that’s where your £10k deposit and £6k pa payments have gone).

If you can afford to lose an extra £30k over the next 3 years, then buy and enjoy. But “£500 pcm” is not really the way to evaluate the cost.

[Roger Irrelevant]

Sorry I'm going to be one of those people.

Forget the monthly stuff, if I've understood correctly then (assuming it's either a three or four year deal) you're talking about spending either £28k (over three years), or £34k (over four), on the M2. Now, in isolation there's no way of saying whether or not that makes sense. If your mind is already made up that you want an M2 or something similar - nothing else will do - then quite possibly that's the best way to do it. However if you are asking about whether or not it makes financial sense to do so vs. getting an older, slightly less flash £10k car, or even keeping your current one going, then the answer has to be almost certainly not.

FWIW if it were me I'd get a £10k car and put the £500 p.m. into some sort of savings vehicle, to be used as a maintenance fund if necessary. Unless you're the unluckiest person in the world then after 3/4 years you'll have a decent chunk of cash - most likely more than ten grand - and you'll still own the car.

(edited for your/you're brainfart)

Edited by Roger Irrelevant on Thursday 12th September 09:39

[Deep Thought]

Roger Irrelevant said:

Sorry I'm going to be one of those people.

Forget the monthly stuff, if I've understood correctly then (assuming it's either a three or four year deal) you're talking about spending either £28k (over three years), or £34k (over four), on the M2. Now, in isolation there's no way of saying whether or not that makes sense. If you're mind is already made up that you want an M2 or something similar - nothing else will do - then quite possibly that's the best way to do it. However if you are asking about whether or not it makes financial sense to do so vs. getting an older, slightly less flash £10k car, or even keeping your current one going, then the answer has to be almost certainly not.

FWIW if it were me I'd get a £10k car and put the £500 p.m. into some sort of savings vehicle, to be used as a maintenance fund if necessary. Unless you're the unluckiest person in the world then after 3/4 years you'll have a decent chunk of cash - most likely more than ten grand - and you'll still own the car.

I'm going to be one of those people too - £10,000 deposit is horrendous, and £500 a month added to that will become draining very quickly.

If you really must change your car to something expensive, i'd be looking at either (a) buying a car outright @ £10K or (b) buy a car at £15K, £20K, £25K or £30K and getting a cheap loan for the difference.

[Denno B]

Can the Op clarify the deposit ? If it’s £10k and still £500 month then at £27.5k over 3 years that doesn’t sound like a very good deal anyway. I’m sure these have been available for sub £5k deposit and monthlies under £500.

[Deep Thought]

Denno B said:

Can the Op clarify the deposit ? If it’s £10k and still £500 month then at £27.5k over 3 years that doesn’t sound like a very good deal anyway. I’m sure these have been available for sub £5k deposit and monthlies under £500.

M2 or M2C?

[Denno B]

Competition, the deal was on pch, £1620 initial, followed by 35 x £540. Was going back a while though, certainly wouldn’t stick £10k in for those payments.

Edited by Denno B on Thursday 12th September 09:52

[Bob-2146]

Deep Thought said:

I'm going to be one of those people too - £10,000 deposit is horrendous, and £500 a month added to that will become draining very quickly.

If you really must change your car to something expensive, i'd be looking at either (a) buying a car outright @ £10K or (b) buy a car at £15K, £20K, £25K or £30K and getting a cheap loan for the difference.

this is a massive u-turn in your previous views DT.

Surely PCP is always the best option and anyone who dares challenge or think otherwise should be attacked personally ?

[Big Easy]

Deep Thought said:

Roger Irrelevant said:

Sorry I'm going to be one of those people.

Forget the monthly stuff, if I've understood correctly then (assuming it's either a three or four year deal) you're talking about spending either £28k (over three years), or £34k (over four), on the M2. Now, in isolation there's no way of saying whether or not that makes sense. If you're mind is already made up that you want an M2 or something similar - nothing else will do - then quite possibly that's the best way to do it. However if you are asking about whether or not it makes financial sense to do so vs. getting an older, slightly less flash £10k car, or even keeping your current one going, then the answer has to be almost certainly not.

FWIW if it were me I'd get a £10k car and put the £500 p.m. into some sort of savings vehicle, to be used as a maintenance fund if necessary. Unless you're the unluckiest person in the world then after 3/4 years you'll have a decent chunk of cash - most likely more than ten grand - and you'll still own the car.

I'm going to be one of those people too - £10,000 deposit is horrendous, and £500 a month added to that will become draining very quickly.

If you really must change your car to something expensive, i'd be looking at either (a) buying a car outright @ £10K or (b) buy a car at £15K, £20K, £25K or £30K and getting a cheap loan for the difference.

Another one of those people here. I definitely wouldn't be putting £10,000 down as a deposit for a car that I'd be handing back in two or three years time.

[Deep Thought]

Bob-2146 said:

Deep Thought said:

I'm going to be one of those people too - £10,000 deposit is horrendous, and £500 a month added to that will become draining very quickly.

If you really must change your car to something expensive, i'd be looking at either (a) buying a car outright @ £10K or (b) buy a car at £15K, £20K, £25K or £30K and getting a cheap loan for the difference.

this is a massive u-turn in your previous views DT.

Surely PCP is always the best option and anyone who dares challenge or think otherwise should be attacked personally ?

I have never ever said PCP is always the best option.

If someone really must drive a new M2(C), then seeking out a similar lease deal to the one quoted would be a much better option - and probably in line with the three year depreciation someone would be facing with a cash purchase anyway.

Personally, if it had to be an M2, with year old cars @ around the £35K mark, i'd be looking at one of those with this level of deposit and a cheap loan.

Please dont derail yet another thread with your prejudiced nonsense posts.

Edited by Deep Thought on Thursday 12th September 11:49

[ZX10R NIN]

Spend between 10-15k on a nice 335i & i think you'll have hit the right balance of bang for your buck as well as spec age mileage & depreciation.

https://www.autotrader.co.uk/classified/advert/201...

https://www.autotrader.co.uk/classified/advert/201...

https://www.autotrader.co.uk/classified/advert/201...

https://www.autotrader.co.uk/classified/advert/201...

Or look elsewhere & you'll still get a nice swift set of wheels.

E350

https://www.autotrader.co.uk/classified/advert/201...

https://www.autotrader.co.uk/classified/advert/201...

E500

https://www.autotrader.co.uk/classified/advert/201...

C350

https://www.autotrader.co.uk/classified/advert/201...

https://www.autotrader.co.uk/classified/advert/201...

https://www.autotrader.co.uk/classified/advert/201...

S5

https://www.autotrader.co.uk/classified/advert/201...

https://www.autotrader.co.uk/classified/advert/201...

https://www.autotrader.co.uk/classified/advert/201...

Edited by ZX10R NIN on Thursday 12th September 16:26