Car purchase prior to commencing bank negotiations

BrokeGuy

Registered User
Messages
62
Hi,

All my finance information has already been provided in a previous post so no need to repeat same.

What I am asking is if there is a risk of buying a car before entering formal discussions with the banks. The position is that our second car is causing a lot of trouble (2003 Corsa) and it is becoming a situation where we are throwing good money after bad so we are thinking about replacing it (especially given we have three kids and cars is way too small)

A friend said they will give us a loan of a few grand to get a car and I would be worried about doing so if the bank were to take it. Can they take it off us leaving the friend high and dry? The deal would be to take the money from our friend and repay them when the car is sold or something like that.

I have around €5k plus trade in but to buy and estate for the that money means you are buying a pre-2008 and the cost of tax can be horrendous (if a diesel) and cost of petrol can be horrendous given it is an estate. All that considered I came across a 2007 Mondeo for €7k which costs €200 in motor tax per annum and has 55 MPG so when you look at that over 8 years the Mondeo would be cheaper than say a €4k Astra because the motor tax is €400 per annum cheaper and fuel is around €1,200 per annum.

In summary the more expensive car is cheaper in the long run and while €7k isn't a lot to some people when buying cars I am the cautious type.

Comments appreciated
 
Hi,

All my finance information has already been provided in a previous post so no need to repeat same.

What I am asking is if there is a risk of buying a car before entering formal discussions with the banks. The position is that our second car is causing a lot of trouble (2003 Corsa) and it is becoming a situation where we are throwing good money after bad so we are thinking about replacing it (especially given we have three kids and cars is way too small)

A friend said they will give us a loan of a few grand to get a car and I would be worried about doing so if the bank were to take it. Can they take it off us leaving the friend high and dry? The deal would be to take the money from our friend and repay them when the car is sold or something like that.

I have around €5k plus trade in but to buy and estate for the that money means you are buying a pre-2008 and the cost of tax can be horrendous (if a diesel) and cost of petrol can be horrendous given it is an estate. All that considered I came across a 2007 Mondeo for €7k which costs €200 in motor tax per annum and has 55 MPG so when you look at that over 8 years the Mondeo would be cheaper than say a €4k Astra because the motor tax is €400 per annum cheaper and fuel is around €1,200 per annum.

In summary the more expensive car is cheaper in the long run and while €7k isn't a lot to some people when buying cars I am the cautious type.

Comments appreciated
Be slow to borrow off a friend. It is lovely he has offered but taking friends money is far too often the road to fallouts.
In answer
The Bank can,t touch that car bought with his money, it will not show up .

Get the Mortgage application in now, no point in delaying,
Suggest get application into your own Bank and a 2nd Bank and see if you get approval etc.
Hopefully the Corsa will hold till then!
In any event you need a car so factor in 300 month for car repayment , ie no point in having house and no car! so unless you can afford both be careful.
 
All that considered I came across a 2007 Mondeo for €7k which costs €200 in motor tax per annum
Are you sure it's only €200 tax for the year? I thought pre 2008 cars were much higher tax than that for a mondeo size'd engine (1.6l +)?
 
Never Never Never borrow money off a friend. It never ends well.
BrokeGuy as this is your username I take it that the bank negotiations are not for new funds. You will need to ensure that your friend is well aware of your financial position and that he is unlikely to get his money back for some considerable time. The bank will not allow you any leeway to pay back this personal loan, so unless the friend is prepared to take a considerable risk in lending you this money you will need to look elsewhere!! The above is generally good advice.
 
Thanks for the above.

Re the car, my bad. It is a 2008 and while I didn't intend on looking at a car that."new" when you allow for the cheap tax compared to petrol estates of older vintage and the MPG it washes out the same cost over 5/6 years but much safer.

My friend is someone I did a lot of work for in the past and saved him a lot of money and he can well afford to sit on this.

I am asking would the bank away to sell the car and give them the proceeds ahead of the lender?

I am thinking they might if there was clear abuse, eg buying a BMW or something, but not here as the car is hardly flash, more practical, and the basis for getting a 2008 car and not older is because it is cheaper to run????
 
Thanks for the above.

Re the car, my bad. It is a 2008 and while I didn't intend on looking at a car that."new" when you allow for the cheap tax compared to petrol estates of older vintage and the MPG it washes out the same cost over 5/6 years but much safer.

My friend is someone I did a lot of work for in the past and saved him a lot of money and he can well afford to sit on this.

I am asking would the bank away to sell the car and give them the proceeds ahead of the lender?

I am thinking they might if there was clear abuse, eg buying a BMW or something, but not here as the car is hardly flash, more practical, and the basis for getting a 2008 car and not older is because it is cheaper to run????
Broke guy.
The Bank will have Zilch hold on a car bought for cash.They did not finance it, they have no title to it , so stop worrying !
 
Can't borrow the car from a friend, difficult for insurance purposes but also because he lives in London.
 
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