Right. Where do I start.
Basically I have got a P reg Polo, 99k miles (1996). A few things don't seem to be right. The steering is very very heavy ( and it's supposed to have power steering), the brakes are rubbish and there is quite a bit of wear and tear on the car... Basically I've got this gut instinct that within the next few months it'll cost me quite a lot to put things right on it. The MOT is due in 3 weeks time and I think it could fail.
Anyhow like most of this world my budget is limited.
I've seen this Mk4 golf,X reg, 39k on the clock @ a volkswagen dealer for £5295. They'll take my old Polo for £900,so it'll cost me £4395.
The Golf will have a year warranty. I test drove it today and it felt perfect. The steering was so light, the brakes so responsive, no creaks etc.... Just felt new!
It'll cost me £100/month for 5 yrs. Apparently I have got the right to hand it back once I've paid half of the value of the car, so I thought that was quite good.
Anyhow, the simple question is what do I do?? Is it worth it??
Many thanks xxxxxx

Hi i wprk for the adminostration department for Reg Vardys and yes that is true in certain circumstances, but you would need to check your finance agreement. If so you must be upto date with payments and not have any late or missed. But just to warn you this can effect your credit rating so be careful.

Avoid the financial deals they offer, your better off getting a loan with the bank. Your paying £1600 interest for that five years, which is a whopping 36% interest.

Still if it was me I would buy a banger, cheaper in the long run, imagine how much the polo will be worth in 5 years time. :D

100 *60 is 6000 so its not a bad deal to be honest

Hi iam just purchasing a peugeot 306 Hdi x reg 38000 on clock i have taken it out for 3 years and i'm paying £146 a month i tried part exchanging my old car but realised it wasn't worth it (instead i'm putting it on ebay) the thing what i've realised is you can blag them for anything full tank of petrol, Tax etc i have also heard its best to buy the car at the end of the month because alot of them have to sell a certain amount of cars per month or they are in the jobcentre
one thing to remember is not to be afraid to walk away from the garage if they don't give you what you want
its like this car i'm getting iam going to end up paying 5800 on a 5000 grand car but when i went to a certain garage(not sure if i can say the name on here) i worked out there finance and i would have been paying 7500 back on a 4200 pound car so make sure you shop about first
As for the golf they are really reliable but check how many owners its had more than 2 find out why
Anyway hope this helps

Originally posted by loulou3
100 *60 is 6000 so its not a bad deal to be honest


36% interest is not a bad deal !?!?! I would hate to see what you thought was a very bad deal

Originally posted by Skatiechik
36% interest is not a bad deal !?!?! I would hate to see what you thought was a very bad deal

I agree .....a bank loan would be a far better option.

Do you know what the APR is for the finance deal?

Originally posted by Skatiechik
Do you know what the APR is for the finance deal?

worked out at £7/month

Originally posted by Skatiechik
36% interest is not a bad deal !?!?! I would hate to see what you thought was a very bad deal

But its not 36% on an annual basis though, is it?

It actually works out at flat rate of roughly 8%, which isn't bad.

Originally posted by Saxon
But its not 36% on an annual basis though, is it?

It actually works out at flat rate of roughly 8%, which isn't bad.

I paid less than 20% in total over 5 years with a loan from sainsburys

Originally posted by Saxon
But its not 36% on an annual basis though, is it?

It actually works out at flat rate of roughly 8%, which isn't bad.

Yes I know, hence myself asking what the APR was.

Originally posted by loulou3
100 *60 is 6000 so its not a bad deal to be honest

And thats just paying for half the car!!! :o

The reason you can hand it back after paying for the car for 5 years is because you won't actually own it. You're just paying the estimated depreciation of the vehicle over the 5 years, with presumably a whopping great APR on top of that.

After five years you can either:

A) Give the car back, leaving you car-less after having paid out £100 a month for 5 years (is this really a good deal?)

B) Make the final payment (which will probably be a couple of grand or so) and the car will be yours

This sort of finance deal is often misused and the customer is not made fully aware of the ins and outs.

Important questions to ask -

1) The final payment amount
2) The APR (They won't want to tell you this, just witter on about flat rates instead, but this is the true cost of borrowing and you are entitled to know)

Finally, just check on money supermarket to see how much a personal loan would cost, and no doubt how much you could save!

As an example, borrowing the £4395 required to pay for the car from NorthernRock would cost £83.97/month over 5 years.

So a total of £5038, nearly £1000 less than the dealer finance.

It's not clear from your description whether it is hire purchase and you have a balloon payment at the end, or if it's something else with an option to hand the car back at 2.5 yrs...

If you can afford £100/month, then borrow the money from NR, pay £102.23 and have it paid off in 4 years instead, total cost £4907, saving nearly £1100 on the dealer price. That way the total cost of finance is only £512 over 4 years instead of £1700 over 5 years.

Get a Cahoot or Northern Rock internet loan.

The good thing is that you can then transfer the balance to a new credit card to benefit from 0% interest for 9 months.

When the interest free period is up, just get another card and transfer the balance again.

I did this a couple of years ago to buy a car and it's essentially cost me nothing. The interest i've not paid has allowed me to make bigger payments and pay it off early.

usually when you buy a car you have paid back the interest in two years.so yes youcan hand the car back to them and they will either re-sell by themselves or auction...but you wont get anything back and you will be car -less.:thumbsup:

Originally posted by Diesel
=Apparently I have got the right to hand it back once I've paid half of the value of the car

I'm told this destroys your credit rating - it'd be worth checking first just in case :)

i could be wrong but bank loans weren't allowed for 5 years on cars, u have to tell them what its for.
also not everyone wants to keep moving cards around, the searches on your credit file also show up .when others look to check your borrowing.this can act as a negative indicator to some lenders.
if u are comfortable with the rate, at least it's not Yes with 29% per annum, go with it.

Originally posted by the_rudeboy
I agree .....a bank loan would be a far better option.

u can't get 5 year loans for car purchase.
the 35% is gross over 5 years and prob equates to 8 percent apr ish.

Originally posted by willman
i could be wrong but bank loans weren't allowed for 5 years on cars, u have to tell them what its for.


So long as the car will last for 5 years, it's not a problem.

A problem would occur if you took out a 5 year loan to buy an old rust bucket that had to be scrapped after 2 years - because then you have to pay another 3 years loan and have no car.

As a bank loan is unsecured, they probably won't care.

Originally posted by willman
u can't get 5 year loans for car purchase.
the 35% is gross over 5 years and prob equates to 8 percent apr ish.

yes you can.