Buying a car

dellas1979

Hello all,

I am currently trying to save money to buy a new car. I plan to save €6k by Dec 09 (have 3k already saved) and buy in Jan10. The cost of the car will be around €12k.

I have never bought a car before off a dealer.

I have a few questions on financing the other €6k.

1. Where would one of the best places to get a loan? How much roughly would 6k over 5 years be per month?
2. Am I doing the right thing in paying 6K directly for the car and have a loan of 6k to pay over, say 5 years?

Thanks

Toots

Some of the banks have repayment calculators on their websites. Here's a couple below:

AIB
PTSB

You could apply to any bank for the loan. The car dealer might also be able to arrange finance for the car for you, the only thing to be aware of with that is it may be a hire purchase agreement as opposed to a loan, so you wouldn't own the car outright until the final payment is made.

Davy

Firstly a lot of people would advise against buying a new car but thats for a different forum, and if thats what you want go for it.

If you have the 3k already saved, and plan to save another 3k by Christmas, why are you putting the other 6k over 5 years? Just seems like madness. Something more like 2 years may be more appropriate.

A bank or a credit union loan are probably the best option. Do not buy it on hire purchase, because you do not own the car until the last payment is paid.

On a loan expect to pay about €6800 on a loan of €6000. Thats roughly €280 a month over 24 months.
One think why i suggested credit unions, they normally are more flexible than a bank. They normally wouldn't charge a penalty for paying off the loan earlier like a bank would. They may offer cheaper payment cover in the event of illness or redundancy.

Toots

Davy wrote: »

They normally wouldn't charge a penalty for paying off the loan earlier like a bank would.

Banks can only charge early repayment penalties on a fixed rate loan, and it depends on the circumstances at that. If you go variable rate, there's no early repayment fee.

Davy

Toots* wrote: »

Banks can only charge early repayment penalties on a fixed rate loan, and it depends on the circumstances at that. If you go variable rate, there's no early repayment fee.

But aren't nearly all car loans fixed rate though

kaiser sauze

Davy wrote: »

But aren't nearly all car loans fixed rate though

You are usually defaulted to a variable rate, but if you request a fixed rate, you may be able to get one.

Toots

Davy wrote: »

But aren't nearly all car loans fixed rate though

No, you're usually given an option of fixed or variable.