Car finance am i mad?

ntlbell

i was looking to borrow 21k over 5 years for a second hand car, is this madness?

i was looking at a mazda6 with all the trimmings, 27k on the clock.

vengeance52

nah its not mad, but shop about. Credit Union and AIB etc do pretty decent rates.

colm_mcm

it really depends on whether you can afford the payments, and how much you want/need a new car!

Elessar

Nah it's not mad, I did the same for a BMW a few weeks ago. Check out Tesco loans ( www.tesco.ie ), they have the best rate in the country atm I believe, 6.9% fixed on any amount. Some good advantages to it aswell. That's who I went with.

Kinetic^

Yeah I heard that Tesco were doing good rates atm.

Could be worse, a friend of mine got finance on a €30,000 lexus IS200.
Everyone thinks he's bonkers.

martin87

your local credit union should beat tesco and they would be much easier to deal with if you get into trouble paying back the money

bazz26

The thing is though that most Credit Unions will only allow you to borrow up to 3 times what you have currently saved with them.

Another thing to note with borrowing such a large amount is depreciation and the car in particular. If you decide to take out a 5 year loan or finance but for whatever reason have to sell the car before the term, you still might end up owing more than the car is actually worth. The Mazda 6 while a lovely car tends to suffer above average depreciation. Worth taking into account before deciding I say.

colm_mcm

Ulster bank will do the same rate as Tesco, Tesco told me it would take up to 3 weeks to sort everything out and to just to to Ulster bank branch to get the same rate if i was in a rush.

gabgab

The thing you need to watch on car finance is the rate, they guy will tell you what the payments are because he probably asked you what he can afford?? Get the rate he is selling it to you at and then shop around,

Also the rule is to finance the car over the period you reckon you will keep it, otherwise you end up in, as someone touched on earlier, negative equity,

this is when you owe say 20k on the car but it is worth 12k because of the depreciation, sounds unrealistic but it is very very common.

PM me if you have any queries, I used to sell this stuff so I know the drill,

Owen

Yup, what the guy above said. The car Dealerships CAN do some serious rates if you squeeze hard enough. My sister works for AIB, and through the garage I work in, I was able to beat her staff rate.

Stky10

bazz26 wrote:

The Mazda 6 while a lovely car tends to suffer above average depreciation. Worth taking into account before deciding I say.

Isn't the current model about to be replaced as well with a newer version, thus making the it depreciate even more?. Only a factor if the OP reckons he'll sell it again soonish though rather than drive it into the ground.

ntlbell

i was getting the finance through my own bank branch tsb as i didn't have enough shares in the credit union, the rate is 7.9

it's a 05 mazda6 sport touring job with full leather interior.

enda1

Deleted User wrote:

Could be worse, a friend of mine got finance on a €30,000 lexus IS200.
Everyone thinks he's bonkers.

He is, he should have got the 220d

PaddyFagan

ntlbell wrote:

i was getting the finance through my own bank branch tsb as i didn't have enough shares in the credit union, the rate is 7.9

it's a 05 mazda6 sport touring job with full leather interior.

Sounds like you should squeeze them to match the tesco rate or take your business else where. That 1% rate difference will save you in excess of €500* over the lifetime of the loan.

Paddy

PS * it could be a lot more, one of the calculators I tried said more like 900, but hey 500 is still a damn sight better off in your pocket than the banks.

unkel

A bit over €500 total saving over the 5 year term is about right, PaddyFagan

Sabre Man

Why not consider something slightly older (and cheaper)?

Personally I would never get into debt to own a car.

Lexus1976

ntlbell wrote:

i was looking to borrow 21k over 5 years for a second hand car, is this madness?

i was looking at a mazda6 with all the trimmings, 27k on the clock.

Dont understand...are you asking? are you mad to take out a loan to buy a car???

Whats mad about that?

ta2kev

I sell finance every day and I've used finance to buy my own car. I've beaten the bank's "best rate" on many occasions. The main thing is to buy the car for the right price. I've come across people with cars worth €6k and a settlement figure of over €10k. If you plan on keeping the car for a few years, I say go for it, you're gonna have to pay for it some way.

ntlbell

Lexus1976 wrote:

Dont understand...are you asking? are you mad to take out a loan to buy a car???

Whats mad about that?

the amount of loan for the year and type of car is really the question.

gbh

ntlbell wrote:

i was looking to borrow 21k over 5 years for a second hand car, is this madness?

i was looking at a mazda6 with all the trimmings, 27k on the clock.

It depends on the proportion of your income you spend paying off the loan adn if you will be looking for a mortgage etc in the near future. Get the mortage maybe first...but there's nothing wrong with wanting a nice car...

Cyrus

5 years is a bit long imo, id only borrow what i could afford to repay over 3, less chance of ending up in negative equity aswell

MercMad

enda1 wrote:

He is, he should have got the 220d

.............are you kidding?

Swop a creamy 6 cylinder petrol for one of Doctor Diesels evil 4 cylinder creations...................not for all the free fuel in the World !

Anan1

Sabre Man wrote:

Why not consider something slightly older (and cheaper)?

Personally I would never get into debt to own a car.

Good advice. The only things worth borrowing for are things that go up in value. A car should be bought outright, or not at all.

Caliden

you don't have to get it all with the bank so as someone said, get as much as you can with the credit union and the rest with the bank.