Loan or Finance?

[Jules86]

Hello guys. Ive decided to get myself an S3 and see what all this ko4 fuss is about 

Im either going to get a loan or go finance as i can buy one outright but it will be an old high mileage. If i finance or loan it i can go higher spec, lower mileage and newer, also i can keep some of my money to use when i want instead of tying it up in a car.

Im looking to keep the car for 3-5 years. Whats best to do 

PCP, balloon payment, loan etc its all quite confusing!

[Ifti]

If you havent got the cash to hand, dont buy the car.
Personally i wouldnt want to get into debt over a car. My mortage is the only debt I have, and the only one I ever want to have!

[Jules86]

I have never signed up to this. It could take me years to collect the cash and i could die next week! My love is cars, i dont smoke, rarely drink and have few hobbies other than detailing (which requires a car) so would happily be in debt over something that made me happy 

[Alexander]

I know what you mean Jules, I'm exactly the same, my car is the thing that I spend most of my time using and most of my other hobbies are free or very cheap so I might as well spend money on a car.

[Jules86]

I know what you mean Jules, I'm exactly the same, my car is the thing that I spend most of my time using and most of my other hobbies are free or very cheap so I might as well spend money on a car.

Exactly. i dont have kids and am training to be signed off for a role which will see me wage improve year on year, also the missus ahs given the go ahead and will pay the insurance 

[Richn83]

I know what you mean Jules, I'm exactly the same, my car is the thing that I spend most of my time using and most of my other hobbies are free or very cheap so I might as well spend money on a car.

Exactly. i dont have kids and am training to be signed off for a role which will see me wage improve year on year, also the missus ahs given the go ahead and will pay the insurance 

She sounds like a keeper 

One thing that you might want to consider is that with some of the financing options the car isnt technically yours until you make the final payment (or the bubble thingy) it belongs to the finance company so you shouldnt really modify the car in any way.  So if you plan to do some mods then an unsecured loan might be a better option.

And if you are likely to want to make additional payment (once you have the money) make sure there is no penalty for paying the loan off early plus a facility to make the additional payments as this will reduce the overall cost of the credit.

[Nasir]

Not sure if it's relevant but Audi are giving 2 years free servicing on finance deals, but not cash deals

[Jules86]

I think its only on new mate but yeah i saw this. Do they move them around for you, so you dont have to travel?

[GTIjames]

Not sure if it's relevant but Audi are giving 2 years free servicing on finance deals, but not cash deals

they must make more money from finance deals, as bmw offered me a bigger discount on a new car if i purchased with finance rather than cash...

i looked into pcp but just seems like a complete waste of money.. you put down a deposit of say £4000 and then pay £800pcm for 3 years and at the end of it you have nothing to show for it... apart from the memories of driving an alright car for a few years..  

imo if you cant afford it dont drive it, especially with the current economic conditions as its going to get a lot tougher for us all over the next couple of years especially if you work in the public sector  

 

[Gene Hunt]

I got a small amount of finance for my GTI.Worked out cheaper than a personal loan for the amount i wanted.

[Richn83]

Jules, from what youve said you can afford an older S3, so what your talking about here is not buying the car outright on finance but topping up the money you have to get a newer better spec'd one? Am I right. While still being able to keep some money in the bank for emergency requirements like zorst and tuning  

[Jules86]

Jules, from what youve said you can afford an older S3, so what your talking about here is not buying the car outright on finance but topping up the money you have to get a newer better spec'd one? Am I right. While still being able to keep some money in the bank for emergency requirements like zorst and tuning  

Basically mate, im looking to finance as big a chunk as possible to leave me more cash for other things (holidays, mods, electronic items etc)

Not sure if it's relevant but Audi are giving 2 years free servicing on finance deals, but not cash deals

imo if you cant afford it dont drive it, especially with the current economic conditions as its going to get a lot tougher for us all over the next couple of years especially if you work in the public sector 

 

I can afford it, just instead of saving 3-400 pound a month for a few years i can have the car now and pay someone the money for the privilege!

[B3n]

My basic opinions are

If your looking to mod the car get a Loan.

If you want the minimum monthly payment and will probably look to change the car every 3 years get a PCP.

If you want the inbetween get a Hire purchase agreement.

With all VWFS finance agreements (except Contract hire) if you buy the car from a main dealer there are no early settlement charges.

[Jules86]

Nice one cheers mate 

[Edition30]

If you havent got the cash to hand, dont buy the car.
Personally i wouldnt want to get into debt over a car. My mortage is the only debt I have, and the only one I ever want to have!

Not everyone has that kind of cash so the amount your saving a month, why not just pay it of the car?

Maybe your paying some interest but you have the car years earlier than saving for it. As long as he has more money in the car than its potentially going to lose he cant get himself into trouble.

Finance rates are dropping at the minute, just go see which works out cheapest. I had PCP but at silly interest rates..so be careful what your signing up to. You pay interest on the full amount (the balloon payment aswel) when taking on PCP.