Borrowing a few grand

[Ingah]

I'm going to want to borrow in the region of £3000-£4000 as i've just secured a new job has increased my pay by enough that i feel i can afford to own a car, and where i would also benefit from owning a car (and i haven't got a car, hence the need to borrow - largely to front the insurance money!). Looking at picking up a medium size 'family' style car that's been looked after - for under a grand (it's the insurance that'll make me need the extra couple of K).

My credit will probably be fairly good for a young guy (i've been continually using my credit card for the past 4/5 years, paying it off in full most but not all months, and not missing payments etc), although i'll be sure to peruse my credit files before applying for anything.

There's a couple of facts that may or may not complicate things though:
I'm looking for a payback period of 3-5 years, but i really would like to be able to pay it off earlier if my new job works out.
I've already got a 0% student overdraft (i'm in the graduate grace period at the moment) and a credit card, all in all probably £4000 of available credit. I'm probably using around £2000 of it - just the 0% overdraft - (but don't really want to use more available credit, because credit card debt is pretty expensive) - should i be reducing, say, my credit card credit limit, before i apply for more loans?
And anyone know what happens if you lose your job and can't afford the repayments?

And what kind of loans should i be looking at? Is this a time for the standard bank loan? Are there any other/better ways of borrowing the money for this circumstance?
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-- Ingah

[Jodie]

I just got another car and needed 2k so I just got a new credit card with 0% for 18 months.
Loans now under 7k are quite high interest rates, it might be worth while asking how much finance is when you buy your car (if it's from a garage) they can also provide payment protection.
Also look around for insurance, they may do the pay monthly option at no extra cost.

[Fowlersrs]

Moneysavingexpert.com is your friend, have a good read up on there, they give u examples of borrowing and recommended routes to go down

[janner_10]

As Jodie said, interest free credit card deals are awesome.

Buy car on credit card (assuming from dealer) then do an interest free balance transfer to another one. Then another after 18 months if you don't pay it off in time.
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Yamaha FZS600 (Now gone to heaven) > CBR600F4i (SOLD) > '99 YZF-R1

[Codemonkey]

So you're wanting to borrow money to buy something that only lasts 1 year (insurance) but pay it back over a period of > 3 years ? What are you going to do when the insurance is due the following year ? Can you not afford to just pay the insurance monthly or get a cheaper car for a couple of years to build up a no claims bonus ?
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Test Passed 10/05/2011 Current bike: XJ6-N

[Ingah]

[Codemonkey]

[bacon]

I have had more than my fair share of debt in the past, I am out of it now and there is nothing other than a house that would ever tempt me back into it again.

You say you have had a considerable pay rise, suffice to say you have been living pre pay rise happily (so the raise will be all extra free cash?) without a car, so it would seem that you could simply wait "insert number of months here" and pay for your new car outright when you actually have the money?.....

[Pete.]

I agree with bacon.
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a.k.a 'Geri'

132.9mph off and walked away. Gear is good, gear is good, gear is very very good

[instigator]

[Groove]

[deleted111]

I'm with Groove on this one.

[drzsta]

Hi, personally taking a loan out is no problem for me. Personally I'm the type of person who has to have had it yesterday rather than in 'a few months time'

Not really a problem as I took out a 5k loan over 2 years, its something that I can pay back outright sooner rather than later due to the relatively small amount. The repayments don't really make any severe difference in my monthly income and outgoings and something that can be afforded.
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Current Bikes - BMW S1000RR ‘17 & KTM 690 SMC-R ‘12

[WannaBeDude]

I disagree with DR for not agreeing with prevoius poster.
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Jogging on, destination living.

[drzsta]

[Flip]

As the others have said I wouldn't borrow 4K to spend 3/4 of it on insurance etc. If you borrow 4K get a 4K car. If you want a car for under a grand, skrimp and save for a bit.

[Ingah]

[JonB]

What was the point in this thread? The overwhelming majority think it is a bad idea but you will go ahead and do it anyway. If your disposable income is that plentiful then you wouldn't be considering credit for a £1k car.

So go ahead and do it, but don't come back kicking and screaming when you are up to your eyeballs in debt...
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Be careful whose advice you buy, but, be patient with those who supply it. Advice is a form of nostalgia, dispensing it is a way of fishing the past from the disposal, wiping it off, painting over the ugly parts and recycling it for more than it?s worth.

[Ingah]

[instigator]

[Ingah]

[syl]

[owl10]

[Groove]

[pixie522]

If you do go for it, IMO you should seriously consider taking out a PPI. Def go through moneysavingexpert to find a provider though, They give really good advice and the companies they advice appear genuine enough, (not like the rip off merchants of the past).
I have one to cover my mortgage and a certain % of my other bills in case I lose my job. It costs me £10 a month.
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Current Bikes: CBR400RR NC29 (knackered) & ZZR600 D1 (Pinky Grrrr!)