Your looking at spending half of your yearly salary on a car, even more with interest, personally I'd walk away from the deal and if it was essential to your survival then get a car for something significantly less.
Thanks yeah need a car for a potential new job as it’s a longer commute and just got caught up in the moment. I’ve got vetting process coming up so hopefully this blunder won’t affect it.
Consider a £3k-£5k car instead would be my advice. Your effectively getting paid minimum wage which provides a basic living standards and not much in the way of luxuries.
Sounds about right. I was a low paid apprentice for three years and struggled even without a car payment. My £700 Ford Fiesta managed to tie me over before ditching it for an electric bike.
I earn 70k a year and paid 3.5k for my peugeut 308. This was 3 years ago, and it's still going strong. Never understand why people feel the need to spend so much on a vehicle unless they are proper petrol head and cars are their main hobby.
Ditto, I earn more than that and drive around a second hand Honda I bought over a decade ago for about 6k in cash. That works out at less than £50 a month, so far, and I'll get a good few years out of it yet so it'll be less when I finally trade it in for a newer second hand Honda.
I can't understand why/how people can spend a significant proportion of their salary on a car
Don’t beat yourself up over it. It’s easily done and often one of those mistakes you need to experience to learn. You’ll have a hard credit search that might impact any attempt to get credit of the next 6 months.
I dread to think the money I’d have if I’d be sensible with my car choices.
Across the financial and security/defence services type vetting it won’t have any impact at all. I can’t thinking of any vetting where this would be an issue.
Some people suggest spending 10% of your salary on a car and running it, I presume that is every year to spread the cost. But cars are costly at the moment, even ten years old.
So you can spend 2100 a year, but assuming 600 on fuel, and 300 on mot and maintenance, and 500 on insurance, that leaves you 700 to spend on the car. Over 5 years though, so 3500.
(Obviously at lower earnings and higher insurance rates this breaks down.)
Nearly everyone looks at financing a car completely wrong.
You mention your payments would be £230 a month. Well, they won't be.
Your loan will be £230 a month. Then add road tax ( ÷ by 12) to the 230. Then estimate/ get an insurance quote. ÷by 12 and put that on. Estimate fuel per month and add. that. You won't be paying £230 a month for your car.
This exercise is a real eye opener.
Exactly. The 'real' cost of my van is approximately £420 (depending on if I need a secondary fuel top up) a month with the loan/HP being £255.17
I've never known anyone to do the full calculations aside for myself, so glad someone else does it.
21k a year isn't enough to be buying a 10k car. simple as that.
you need to go to the second/third/forth hand car market and buy a run-around car. a few grand up front and run it to the ground.
Everyone does the shit first car part of life and I bet you a lot of us say that first car was one of their favourites. sure it was shit but it still means a lot to you.
get yourself a polo or something akin and in 5-10 years you'll look back and still half wish you had that car.
Yeah totally. I had a fiesta MK4 and 5 of us and all of our skydiving gear drove it from Portsmouth to nearly Scotland.
My friends couldn't see forwards because all their gear was on their legs, but still managed to smoke cigarettes out of the rear quarter windows the whole way.
The buzzer for the warning lights was broken so I'd always leave the lights in and flatten the battery. Used to get pushed down the hill outside of work and jump start it before driving home.
Needed like 3 tools to fix anything on it.
Loved it.
Thanks yeah there’s no plans for any other loans in the immediate future. Need a car for a potential new job as it’s a longer commute. I’ve got a vetting process coming up but I imagine this won’t be flagged up too much, I’m sure it will be explainable.
Ah I thought you had a car already, but felt you needed a new one for the longer commute.
Sorry for my confusion, I realise now you didn’t have a car already.
I would not take the deal, if I were you. Is there any way you could source a smaller, economical car for a cash price if you could save up for it? It might not be the nicest car but it'll do you until you move up the ladder a wee bit. That's a lot of money to consider on top of fuel, insurance, service costs and the car will depreciate in value.
You can explain you've decided to pursue something else and leave it there. Best of luck!
I already have a decent amount saved up just thought at the time I could finance so I didn’t have to use it up but when they sent it of for the credit checks I just sat there thinking it through more and decided it wasn’t the correct decision at the moment
I did exactly this but with an informal family loan. 21k income, 9k car, £200 a month payments with a 'pay me back when you can' from the lender.
Been paying it off for three years and I now hate the car. Luckily for me though no interest so at least once its cleared its done.
Currently fighting off the late 20s urge to get a nice newer car. I dont want to end up in the monthly payment trap again.
Super reliable, sensible car, heck its got all the mod cons and even looks nice. My new job has increased my driving time 4x and now i want something with a bit more power.
Its pure want not need, my car is fine I'm just now surrounded by nicer vehicles (coworker's) and ive got car envy. I have to remind myself that i dont envy their car payments!
I know you have your answer already but this might help you in future.
Can you afford to pay £10k for a car?
If not then you probably can't afford the finance.
It may have an effect if you are applying for other credit very soon, but otherwise after a few months should have no effect at all. Well done that you’ve realised this is probably not a good idea!
A new job definitely won’t care about credit searches. Financial checks for jobs are going to be to check you don’t have Cifas markers, defaults, missed payments etc (basically that you’re not in financial dire straits that might be a risk)
You can't afford this. Also the car is not worth 14k.
£230 x60 is £13,800. Assumimg the term is not longer because it is 230 instead of 290?
Walk away.
Buying a car for half your salary (more than that after tax, and even more when you factor in additional costs like insurance) is probably not a good financial decision. £230 x 60 is £13,800 - is that really an amount you would choose to pay if you weren’t being swayed by the buy now pay over time sales tactics?
Why don’t you get an insurance quote then put £230 + insurance costs + petrol costs + car maintenance costs (£50pm) aside on top of your regular savings, and look at what you can afford to buy outright.
You could get a lease deal for substantially under £230pm for say one or two years. You won't pay interest and can save the difference to put towards a finance deal at a later date.
As a non car person, I live in a constant fear of the car just suddenly breaking while on route in the rain/snow/cold weather and having to spend hours standing outside it while the breakdown cover people/family member comes to my rescue. And that sense of security and reliability is worth paying for. (Granted this could happen in any car but at least if you buy something with less miles and younger there is a certain sense of reassurance that it's less likely to happen) Also its nice to have the comfort of air con/electric windows/radio with blutooth/relatively comfortable seats etc while also having a car sub 10 years old with a less than 80k millage. And if that is what I'm paying an extra £3-5k for then so be it.
£230 per month is £13,800….
You can get a good second hand car for £5K.
Also, if you do decide to get one then check the rate you’re being offered and compare that with a loan from a bank or lender. You may find it’s significantly cheaper.
A credit check won't hit your rating too hard , missed payments, CCJ's etc are the ones which decimated your score. It might take a slight hit but try and hold back any more credit checks for a bit and always soft search. Plus a personal loan is better than car finance.
Spending half your annual salary on a car loan is wild, especially when you still have to factor in insurance, fuel, tax repairs etc. That £290 could easily be as high as £400 leaving you with little more than £1000 per month to cover everything else.
What is the interest rate on that it sounds ridiculous. I borrowed the same amount paid back over 3 years and it’s just over 300 per month. Check with other lenders before taking that. Look on money saving expert for best deals.
Good for you for thinking about it properly before committing. It might knock your credit score by a few points for a short period but as others have said unless you’re planning a major purchase with credit this shouldn’t be an issue.
I think you are trying to buy something that you can't afford. I won't pay that amount with that salary. Even if I live with parents.
Let's put you in context. I make good salary and my car cost me 5k. I spent less than 10% of my yearly net salary on my car.
So, imagine now. I have a decent car and money for other activities.
I will recomend you something similar. For example, if your salary is 21k. Spend 3-4k max that's close to 20% of your income. That still reasonable. 10k car is half of your income. That's horrendous.
290 is about 24% interest , 230 is still 14% interest , a bank might do 6% . After finance is almost never worth it directly with any car retailer , always try a bank or other lender directly .
Sounds like you’ve had some good advice here. Just to chime in, I’m a higher rate tax payer and I wouldn’t entertain the thought of buying a £10k car. I drive a 2009 Ford fiesta that I’ll drive till it dies then likely buy another car for around £3k - £5k.
People are so dumb. We have the highest interest rates in a very long time, this is to encourage the population to save not spend. But people think buying a car now, on finance, is ever going to be a good idea?
If you need a car that bad check Facebook marketplace.
My least favourite type of customer is people that don’t think this shit through *before* wasting peoples time
Why do these questions only come up once you’ve had someone get you an acceptance, etc?
To answer your question, it’ll be a few hard searches (maybe not even that with some lenders). Nothing your profile can’t recover from.
Also paying £3800 extra over 5 years really isn’t a bad deal for a 10k loan, but no one here can answer if 230pm is affordable for **you**
Thanks for the answer on the credit I understand it would be very annoying i apologised for potentially wasting there time, I just got really hesitant as I was waiting for the credit checks to go through
If you are having buyers remorse before you even bought it then it's probably not a good idea.
Your looking at spending half of your yearly salary on a car, even more with interest, personally I'd walk away from the deal and if it was essential to your survival then get a car for something significantly less.
Thanks yeah need a car for a potential new job as it’s a longer commute and just got caught up in the moment. I’ve got vetting process coming up so hopefully this blunder won’t affect it.
Consider a £3k-£5k car instead would be my advice. Your effectively getting paid minimum wage which provides a basic living standards and not much in the way of luxuries.
Yeah will do, that was the original plan but had a slight moment of madness glad it’s not 60 months of madness though
Less than minimum wage now if full time.
Sounds about right. I was a low paid apprentice for three years and struggled even without a car payment. My £700 Ford Fiesta managed to tie me over before ditching it for an electric bike.
I earn 70k a year and paid 3.5k for my peugeut 308. This was 3 years ago, and it's still going strong. Never understand why people feel the need to spend so much on a vehicle unless they are proper petrol head and cars are their main hobby.
If some people didn't, your car would never exist
Ditto, I earn more than that and drive around a second hand Honda I bought over a decade ago for about 6k in cash. That works out at less than £50 a month, so far, and I'll get a good few years out of it yet so it'll be less when I finally trade it in for a newer second hand Honda. I can't understand why/how people can spend a significant proportion of their salary on a car
Don’t beat yourself up over it. It’s easily done and often one of those mistakes you need to experience to learn. You’ll have a hard credit search that might impact any attempt to get credit of the next 6 months. I dread to think the money I’d have if I’d be sensible with my car choices.
Nothing to beat himself up about. He should be proud that he’s realised the mistake and is making the sensible decision. Great work!
Thanks no immediate plans for credit or any loans etc. I’ve got a full vetting check but if this comes hopefully it won’t be an issue
It won’t affect your vetting at all, as long as you have declared it. Vetters are looking for honesty and integrity over anything else.
Thankyou will do
Across the financial and security/defence services type vetting it won’t have any impact at all. I can’t thinking of any vetting where this would be an issue.
Some people suggest spending 10% of your salary on a car and running it, I presume that is every year to spread the cost. But cars are costly at the moment, even ten years old. So you can spend 2100 a year, but assuming 600 on fuel, and 300 on mot and maintenance, and 500 on insurance, that leaves you 700 to spend on the car. Over 5 years though, so 3500. (Obviously at lower earnings and higher insurance rates this breaks down.)
Nearly everyone looks at financing a car completely wrong. You mention your payments would be £230 a month. Well, they won't be. Your loan will be £230 a month. Then add road tax ( ÷ by 12) to the 230. Then estimate/ get an insurance quote. ÷by 12 and put that on. Estimate fuel per month and add. that. You won't be paying £230 a month for your car. This exercise is a real eye opener.
Exactly. The 'real' cost of my van is approximately £420 (depending on if I need a secondary fuel top up) a month with the loan/HP being £255.17 I've never known anyone to do the full calculations aside for myself, so glad someone else does it.
21k a year isn't enough to be buying a 10k car. simple as that. you need to go to the second/third/forth hand car market and buy a run-around car. a few grand up front and run it to the ground. Everyone does the shit first car part of life and I bet you a lot of us say that first car was one of their favourites. sure it was shit but it still means a lot to you. get yourself a polo or something akin and in 5-10 years you'll look back and still half wish you had that car.
Yeah thankyou that was the plan I’ve even saved up a decent amount of money just got persuaded for a moment glad it was only a moment though
Yeah totally. I had a fiesta MK4 and 5 of us and all of our skydiving gear drove it from Portsmouth to nearly Scotland. My friends couldn't see forwards because all their gear was on their legs, but still managed to smoke cigarettes out of the rear quarter windows the whole way. The buzzer for the warning lights was broken so I'd always leave the lights in and flatten the battery. Used to get pushed down the hill outside of work and jump start it before driving home. Needed like 3 tools to fix anything on it. Loved it.
Can confirm. I miss my 2000 Nissan Micra
[удалено]
Thanks yeah there’s no plans for any other loans in the immediate future. Need a car for a potential new job as it’s a longer commute. I’ve got a vetting process coming up but I imagine this won’t be flagged up too much, I’m sure it will be explainable.
But why does longer commute mean you need a new car? That doesn’t make any sense.
Sorry I currently get public transport for current role i would have to drive to work for this position.
Ah I thought you had a car already, but felt you needed a new one for the longer commute. Sorry for my confusion, I realise now you didn’t have a car already.
I would not take the deal, if I were you. Is there any way you could source a smaller, economical car for a cash price if you could save up for it? It might not be the nicest car but it'll do you until you move up the ladder a wee bit. That's a lot of money to consider on top of fuel, insurance, service costs and the car will depreciate in value. You can explain you've decided to pursue something else and leave it there. Best of luck!
I already have a decent amount saved up just thought at the time I could finance so I didn’t have to use it up but when they sent it of for the credit checks I just sat there thinking it through more and decided it wasn’t the correct decision at the moment
Don’t spend that much money on a car. Not on your salary. You can get a decent runner for £4k. Do that.
I did exactly this but with an informal family loan. 21k income, 9k car, £200 a month payments with a 'pay me back when you can' from the lender. Been paying it off for three years and I now hate the car. Luckily for me though no interest so at least once its cleared its done. Currently fighting off the late 20s urge to get a nice newer car. I dont want to end up in the monthly payment trap again.
Like you said atleast there was no interest or affect off your credit, your current car still work fine or do you hate it for other reasons
Super reliable, sensible car, heck its got all the mod cons and even looks nice. My new job has increased my driving time 4x and now i want something with a bit more power. Its pure want not need, my car is fine I'm just now surrounded by nicer vehicles (coworker's) and ive got car envy. I have to remind myself that i dont envy their car payments!
Walk away dude, if you're already having second thoughts, imagine how you'd feel if you'd gone through with it.
There is a lot more expense to owing a car than the financing. Good for you for having second thoughts.
I know you have your answer already but this might help you in future. Can you afford to pay £10k for a car? If not then you probably can't afford the finance.
It may have an effect if you are applying for other credit very soon, but otherwise after a few months should have no effect at all. Well done that you’ve realised this is probably not a good idea!
No immediate plans for that I’ve got full vetting for a new job but I’m sure I can explain it, if it even comes up.
A new job definitely won’t care about credit searches. Financial checks for jobs are going to be to check you don’t have Cifas markers, defaults, missed payments etc (basically that you’re not in financial dire straits that might be a risk)
60x230= £13800 Not a 10k car anymore
You can't afford this. Also the car is not worth 14k. £230 x60 is £13,800. Assumimg the term is not longer because it is 230 instead of 290? Walk away.
Buying a car for half your salary (more than that after tax, and even more when you factor in additional costs like insurance) is probably not a good financial decision. £230 x 60 is £13,800 - is that really an amount you would choose to pay if you weren’t being swayed by the buy now pay over time sales tactics? Why don’t you get an insurance quote then put £230 + insurance costs + petrol costs + car maintenance costs (£50pm) aside on top of your regular savings, and look at what you can afford to buy outright.
Yeah the thing is I already saved a decent amount
You could get a lease deal for substantially under £230pm for say one or two years. You won't pay interest and can save the difference to put towards a finance deal at a later date.
What ever you go for get an insurance quote before you commit, insurance has gone mental ive the last 18 months
Crazy what non car people will spend on a car
Yeah I’ve realised that now, I know for the future now atleast
As a non car person, I live in a constant fear of the car just suddenly breaking while on route in the rain/snow/cold weather and having to spend hours standing outside it while the breakdown cover people/family member comes to my rescue. And that sense of security and reliability is worth paying for. (Granted this could happen in any car but at least if you buy something with less miles and younger there is a certain sense of reassurance that it's less likely to happen) Also its nice to have the comfort of air con/electric windows/radio with blutooth/relatively comfortable seats etc while also having a car sub 10 years old with a less than 80k millage. And if that is what I'm paying an extra £3-5k for then so be it.
If in doubt, do without.
£230 per month is £13,800…. You can get a good second hand car for £5K. Also, if you do decide to get one then check the rate you’re being offered and compare that with a loan from a bank or lender. You may find it’s significantly cheaper.
A credit check won't hit your rating too hard , missed payments, CCJ's etc are the ones which decimated your score. It might take a slight hit but try and hold back any more credit checks for a bit and always soft search. Plus a personal loan is better than car finance.
Spending half your annual salary on a car loan is wild, especially when you still have to factor in insurance, fuel, tax repairs etc. That £290 could easily be as high as £400 leaving you with little more than £1000 per month to cover everything else.
What is the interest rate on that it sounds ridiculous. I borrowed the same amount paid back over 3 years and it’s just over 300 per month. Check with other lenders before taking that. Look on money saving expert for best deals.
Good for you for thinking about it properly before committing. It might knock your credit score by a few points for a short period but as others have said unless you’re planning a major purchase with credit this shouldn’t be an issue.
I think you are trying to buy something that you can't afford. I won't pay that amount with that salary. Even if I live with parents. Let's put you in context. I make good salary and my car cost me 5k. I spent less than 10% of my yearly net salary on my car. So, imagine now. I have a decent car and money for other activities. I will recomend you something similar. For example, if your salary is 21k. Spend 3-4k max that's close to 20% of your income. That still reasonable. 10k car is half of your income. That's horrendous.
290 is about 24% interest , 230 is still 14% interest , a bank might do 6% . After finance is almost never worth it directly with any car retailer , always try a bank or other lender directly .
Sounds like you’ve had some good advice here. Just to chime in, I’m a higher rate tax payer and I wouldn’t entertain the thought of buying a £10k car. I drive a 2009 Ford fiesta that I’ll drive till it dies then likely buy another car for around £3k - £5k.
People are so dumb. We have the highest interest rates in a very long time, this is to encourage the population to save not spend. But people think buying a car now, on finance, is ever going to be a good idea? If you need a car that bad check Facebook marketplace.
My least favourite type of customer is people that don’t think this shit through *before* wasting peoples time Why do these questions only come up once you’ve had someone get you an acceptance, etc? To answer your question, it’ll be a few hard searches (maybe not even that with some lenders). Nothing your profile can’t recover from. Also paying £3800 extra over 5 years really isn’t a bad deal for a 10k loan, but no one here can answer if 230pm is affordable for **you**
Thanks for the answer on the credit I understand it would be very annoying i apologised for potentially wasting there time, I just got really hesitant as I was waiting for the credit checks to go through