Anyone else offering this?

darragh o meara

I seen this a while back and thought nothing about it again until it popped up in my Facebook feed in the last few days.

http://www.payasyougoauto.ie

Its the new wave of if you'd call it subprime car finance and in fairness a lot of people would have been lucky to escape the recession without some form of an adverse rating on their credit score which now affects them getting car finance now. It seems to be based on a US model that seems to be popular over there.

To me this seems like a good idea, although Im sceptical about there being some form of a catch buried in there somewhere. if its as it says on the tin, it seems like a half decent way for someone who might not have got through the recession unscathed to get a car that they can afford now but can't get finance for. Personally Im looking at it at the moment as I hope to get a mortgage in the next year and banks nowadays are looking for every reason not to give you one and a pre existing car loan would definitely be a reason for them to say no, my thinking I that this could stay off the radar or so to speak.

Is there any other dealers around the country offering this? or indeed anyone who has taken up this offer and would be willing to let the rest of this community know the score?

Before we answer below, We all know about the owner of GBM, good bad or indifferent so id prefer if this didn't turn into a owner bashing thread. Im more interested in the concept than the owner.

Nody

Well there are several catch things in it:

1) 1.000 EUR down payment
2) 200 EUR application fee (no matter what)
3) 250 EUR documentation fee
4) All service has to be done by them (i.e. it is not going to be cheap)
5) Maximum price is 12.000 EUR value on the car
6) Limited to 20 different cars only

Now if you can put up 1.500 EUR on the table along with their monthly cost (140 to 340 EUR a month excl. service) you can save up enough money to outright buy a car I'd say.

darragh o meara

Nody wrote: »

Well there are several catch things in it:

1) 1.000 EUR down payment
2) 200 EUR application fee (no matter what)
3) 250 EUR documentation fee
4) All service has to be done by them (i.e. it is not going to be cheap)
5) Maximum price is 12.000 EUR value on the car
6) Limited to 20 different cars only

Id imagine thats how he makes it worth his while, In fairness a 1000 euro isn't a lot when your trusting someone with paying you back for a 12000 euro car.

As for limited to 20 cars, Im led to believe that he will source a car for you within that bracket too if eligible, so maybe the range is a bit broader.

Nody wrote: »

Now if you can put up 1.500 EUR on the table along with their monthly cost (140 to 340 EUR a month excl. service) you can save up enough money to outright buy a car I'd say.

I agree with you here, however a lot of people would find it hard to save that kind of money when they need a car i.e. old car needs repairs, well your old car has to keep you going until you can save for the new one, so you'd have to pay for the repairs for that hence dipping into your funds. Plus if you needed a new car in a hurry and didn't want to wait, it might not be a bad option.

Servicing is a bit of a setback, but they seem have that covered too by a small sum additional.

Nody

darragh o meara wrote: »

Servicing is a bit of a setback, but they seem have that covered too by a small sum additional.

5.5 EUR a week is almost 300 EUR a year for a standard service excl. oil (400 EUR inc. oil); I'm quite sure you can get away cheaper than that (and that's the lowest price for the most basic car; expect that to be higher for the more expensive options). Same with offering a tire package etc. Also how is the buyer going to handle the replacements etc. required due to age (as once again these are not going to be brand new cars so parts will need to be replaced over time) if they can't handle to save up to the money to buy one outright?

As for limited to 20 cars, Im led to believe that he will source a car for you within that bracket too if eligible, so maybe the range is a bit broader.

But in most cases for a larger deposit; which once again means you need to have more money up front and question the whole idea. Of course a lot depends on the cars in question but I simply don't see it as a brilliant deal but rather as a case of trying to grab people with less than stellar financial understanding. For example if we take the 12k car option as an example; 1.000 EUR deposit and 340 EUR x 24 repayments would still only cover 9.160 EUR of the value so how long is that going to require to be repaid (and serviced!) at their shop?

Atlantic Dawn

Theres 20 cars, you can be sure they are not all that desireable. If someone is having trouble getting standard finance for their car they should buy a €1000 runaround, if they can't afford that they should stick to cycling. No mention of insurance either, how would that be covered?

darragh o meara

darragh o meara wrote: »

......

To me this seems like a good idea, although Im sceptical about there being some form of a catch buried in there somewhere. if its as it says on the tin, it seems like a half decent way for someone who might not have got through the recession unscathed to get a car that they can afford now but can't get finance for. Personally Im looking at it at the moment as I hope to get a mortgage in the next year and banks nowadays are looking for every reason not to give you one and a pre existing car loan would definitely be a reason for them to say no, my thinking I that this could stay off the radar or so to speak.

.....

Max value 12k, can see the cars being high mileage 5 year old base spec passats at best, wouldn't make huge sense for 1k deposit and a monthly fee of 200ish a month imo.

Can't see it going under a mortgage application radar either despite not being a car loan.

Nody

Nody wrote: »

1) 1.000 EUR down payment
2) 200 EUR application fee (no matter what)
3) 250 EUR documentation fee

That makes it a bit redundant, surely? If you're strapped for cash, wouldn't you just buy a car for €1,500 and get it over with?

I picked up my Focus for €1k and although I'm aware i've been lucky-ish in that not a lot has gone wrong with it, it's cost me less than €80 to service it (DIY), €30 to fix a heat shield underneath it and that's been it.

Surprisingly economical, too.


I don't understand why someone would be putting themselves in debt or under pressure to pay weekly fees, if they have 1.5k in their pocket and could buy a car outright anyway?


https://cars.donedeal.ie/cars-for-sale/13502003-ford-focus-1-4-new-nct/9689001


There's an 03 Focus with a fresh NCT for €1,350. Tax it for three months and you're on the road and laughing for about the same you'd spend just sitting in a car with this crowd.


And if you lose a job or come into some financial difficulties, you've something to sell to recoup some cash.