Our car has now all but died, so we need a new one..........................

@dorypanda (1584)
June 6, 2008 3:26am CST
Can anyone tell me about car finance and how it works please? I've never bought a brand new car before so no idea how it works or anything. Also, if you live in or near Warwickshire and see a decent car for sale would you let me know please? It has to be a small car, 5 doors, automatic. Thank you for your help.
2 responses
@p1kef1sh (45642)
6 Jun 08
The very first place to start Dory is with a budget. How much can you afford to spend? You already know the rough type of car that you want. But do you want something sporty, or "Mumsy". I will presume that you want a small family car. I have to say that you can do a lot worse than the Ford Focus or the Volkswagen Polo or Golf. Toyotas are good and the Skoda Octavia is as good as the Volkswagen and cheaper. Go to www.whatcar.com for a better feel. There is also stuff there about financing too. So you have the make in mind. Now you have to find the spondooliks! Some garages might take your existing car as part exchange. Don't expect much for it. You might be better selling it privately, but that can take some time. Garages will also often expect a deposit if the value of your car is insufficient - but not always. Now you have a number of options. The bank/Building Society will nearly always be the cheapest place to borrow money. I would suggest not borrowing from a car dealer unless you have no other option. However, there are car purchase plans provided by manufacturers usually, where you pay a deposit and then borrow money over a set period, typically three years, effectively paying the interest back. At the end of the period you still owe the capital price. You can pay this and the car is yours. Or, subject to a mileage agreement, they will take the car back, often as part exchange against a new one. If you don't part exchange then you have effectively "rented" the car for the three years. This method of purchase is popular with many but unless you come into money you are effectively tied to one manufacturer. You can, under certain circumstances lease your car under a private plan. These are not so common for private buyers, but do exist. The best advice that I can give you is to look at the What Car website or buy a copy of the magazine. What is often worth considering is a dealer's low mileage second hand car, or dealer's demonstration car. These will have been well maintained and still have most of their guarantee period left. I am sure that there is loads more that I haven't said. Good luck.
2 people like this
@p1kef1sh (45642)
6 Jun 08
PS Dory. Think hard about running costs too. Petrol is expensive, so you want a good mileage per gallon. Diesels are better than petrol cars in this respect. But the price of diesel at the pump is up to 10P a litre more right now. Also think about Road Tax. The smaller the engine size the lower the tax. Insurance and maintenance costs also need to be factored in.
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@dorypanda (1584)
6 Jun 08
Thank you, that's very useful information. I need a small car because I'm a newly qualified driver and so quite scared of big cars. ;) I didn't think of buying a demonstration car, that sounds like a viable option. At the moment I have approximately £0 yes, you read that right! I have £0 to spend but I reckon we could afford a monthly payment of something, I need to work out what though. Thank you again for your help. :)
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@p1kef1sh (45642)
6 Jun 08
My pleasure. At least you know how much you have got! My only other advice is not to over stretch yourselves. Have fun and don't swallow the salesman's patter. There is always room for some discount plus freebies. Mats, full tank of petrol. I even got an umbrella once.
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@mummymo (23709)
7 Jun 08
I have never bought a brand new car either dorypanda and I am not too up on the car financing apart from sometimes it is far better to go to the bank for a loan as the car financing with the garages can be far more expensive! Our car is falling apart but we can't afford to replace it I am afraid! xxx