MK5 Golf GTI
General => Random Chat => Topic started by: samdem on January 11, 2013, 12:48:26 pm
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Hi All,
Just wondering if anyones taken out a loan to cover costs of modding their cars?
Im seriously considering it, but i would liek to know peoples thoughts on this matter first? has anyone regretted it? or has anyone been glad they did?
Im in a very stable job and earn a decent wage, saving just seems un-realistic on top of all the other things. but if ive got it coming out my account on a specified date at the start of the month i will be okay. i will just have to adjust to it.
Cheers in advance!
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Cue loads of people saying finance is the work of the devil!
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If you can get a very competitive finance rate, can afford the payments, will get value out of them before you sell the car. Then why not?
Try to loan over the shortest period possibe and hunt for the very best rate you can find. Depending on the value of the mods, you might only pay a very negligeable amount in interest.
Another option would be a 0% purchase credit card.
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I have put some on the credit card, but thats 0% interest anyway.
Demon tweaks offer finance iirc so thats another option for you.
If your struggling wih the cost of modding, which isnt exactly the cheapest hobby , you should hound the for sale section on here. Thats the best place to pick up bargains and theres always second modifications popping up in there.
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yeah see, ive always been against getting loans but the way i see it. im going to have the car for atleast naother 2 years and with mods maybe even longer.
150 per month for a year/ year and a half shouldnt make much difference to me, i will just have to cut down on a few luxuries maybe.
what happens if i come into a sum of money, can i pay back alot more one month? I'm really not sure how it works!
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yeah see, ive always been against getting loans but the way i see it. im going to have the car for atleast naother 2 years and with mods maybe even longer.
150 per month for a year/ year and a half shouldnt make much difference to me, i will just have to cut down on a few luxuries maybe.
what happens if i come into a sum of money, can i pay back alot more one month? I'm really not sure how it works!
Due to the changes in recent years. All loans are now flexible. Meaning you can make overpayments. The best way to overpay is to get the term of the loan reduced, not the amount of the payments. This is the most interest friendly approach and offers the largest savings. You can of course pay the loan in full at any time. Overpayments and paying the loan off in full are usually subject to 30 days of interest being applied to the account first.
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Just fund it wisely, credit cards at 20%+ APR probably arent the best way, look for a deal. You're purchasing something that is probably going to lose 30-50% of its value instantly and cost you labour to fit on top. Should anything happen, it's not as simple as selling it all to pay the debt.
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i always save the money up to pay for my mods
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Ive never had a loan in my life with the exception to Student Loan and mortgage... if one cant afford it... dont buy it :happy2:
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Deako - Thanks for the info. i may go in and speak to my bank aswell before maing a decision, seems there is alot to think about.
Tony - Yep you are right about it losing its value instantly, my job seems stable but i suppose anything can happen..
This is a tough one, i was looking to borrow money for exhaust, remap, wheel refurb and tyres.
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I guess if you can get enough on a 0% credit card over 12/18months, and you are religiously paying it off, then I can't see the difference than saving the money up; other than you getting your mods sooner.
You should defo. work out how much it's going to cost you otherwise though, might be an eye opener.
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Try setting up a direct debit into another account. It will come out of your account on a specific day (just like a loan repayment). Then when the pot is big enough:
GO PLAY.
I did get my DV and REVO stage 1 map while I was still paying the finance.
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Loans to mod?
Ok i will have £ 10,000 :innocent: not paying more than 5% APR though. :happy2:
PM me for bank transfer details. :happy2:
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Don't get in debt, it'll soon take the fun out of your 'financed' mods!
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if you cant afford to mod, dont mod
simple in my eyes
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Ive never had a loan in my life with the exception to Student Loan and mortgage... if one cant afford it... dont buy it :happy2:
I subscribe to Oscar Wilde's theory:
"Anyone who lives within their means suffers from a lack of imagination"
Seriously though. We put £40k into home improvements last year, largely financed by a loan. We've done exactly the same in the past. The way I see it, I can benefit from it now, or I can scrimp and save for years then finally get it. Essentially you've got to be able to afford the loan, so what's the difference. If you're prepared to pay and the finance is cheap then why not?
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I thought about it, then slapped myself around the face with a wet fish!
If you can happily have £150 go out of your account each month then instead of a load set up a high interest savings account and set it up, I did this, refused a card for the account so I could only take my money out my closing it, saved up enough for my BM and then closed account, much better then getting a loan!
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£150 a month is £1800 a year. It's going take a good few years before you get what you want. Life's too short.
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£150 a month is £1800 a year. It's going take a good few years before you get what you want. Life's too short.
This is true, if i save up by the time ive got it i may not get as much use out of the parts as its just taken me X amount of time to save for it. where as if i got a loan i would be using it whilst im still paying for it.. hmm interesting.
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£150 a month is £1800 a year. It's going take a good few years before you get what you want. Life's too short.
:happy2:
I love the holier than thou finance brigade though. "if you cant afford it, dont buy it"
If you can borrow the money at next to nothing and pay it back within your means, then there is no problem with that. Its actually what makes the world tick, and if people dont borrow and banks dont lend, the country grinds to a halt. As we have found out.
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Believe me Luke, I'm putting in a heroic effort to keep it going!
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Ive never had a loan in my life with the exception to Student Loan and mortgage... if one cant afford it... dont buy it :happy2:
I subscribe to Oscar Wilde's theory:
"Anyone who lives within their means suffers from a lack of imagination"
Seriously though. We put £40k into home improvements last year, largely financed by a loan. We've done exactly the same in the past. The way I see it, I can benefit from it now, or I can scrimp and save for years then finally get it. Essentially you've got to be able to afford the loan, so what's the difference. If you're prepared to pay and the finance is cheap then why not?
Its all relative to income though Andrew, your borrowing that 40K to sort of invest in a long term commitment and you are actually living in the benefit of the investment. This guy is just burning this money away, borrowed or not. The pleasure gained from the mods will have faded long before his final payment.
I am happy to borrow for cars and houses, but i am like Rich for anything else. I only buy it once i have it in the bank.
+ to add to this, cheap borrowing has disappeared.
I have just got back from a visit to my mortgage advisor and it was a real eye opener this time. I ended up with a good rate. ( just ) 3.14 APR fixed for 5 years, but the criteria to get this was scary. There are hardly any lenders now, willing to do interest only for anything above 50% LTV i was lucky the mortgage i wanted was available to me. Even then though my earnings now fall below there borrowing threshold even though i have a great income and job security. My missus and her earnings has now had to be added to the deal. It is similar to what you mentioned in another thread about getting loans. The advertised rates look good but the criteria for getting them is to hard. My advisor said a good percentage of his customers recently have all got good credit ratings and can afford new deals but they are getting knocked back and just having to revert back to the banks standard variable rate normally 5 or 6 %. :confused:
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Believe me Luke, I'm putting in a heroic effort to keep it going!
Me too. I think i keep Tesco, Halifax & Barclays in business. :grin:
Which reminds me, i have some stoozed cards coming to an end of their 0% in a few months time, so need to start looking for some more 0% transfer cards. We are only talking £6k in total across 4x cards, but its still fun paying no interest.
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3 examples.
A MacBook:
12 months on 0% finance through Apple, get it now.
Save for 12 months, get it then.
12 months on 25% finance via a credit card, get it now.
2/3 options get it you now. 2/3 options cost you the same amount. 2/3 options make sound financial sense.
Guess which one of the options is the reason finance gets a bad name?
I don't disagree that spending money on mods is basically pissing it against a wall, but we've all done it. If I could get back every pound I've wasted on cars, I'd waste it on a car.
Oh, and for what it's worth, I've never borrowed to mod. I don't think I would either, but I'm not going to lambast people, they just need to do it right.
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Its all relative to income though Andrew, your borrowing that 40K to sort of invest in a long term commitment and you are actually living in the benefit of the investment. This guy is just burning this money away, borrowed or not. The pleasure gained from the mods will have faded long before his final payment.
I am happy to borrow for cars and houses, but i am like Rich for anything else. I only buy it once i have it in the bank.
+ to add to this, cheap borrowing has disappeared.
I have just got back from a visit to my mortgage advisor and it was a real eye opener this time. I ended up with a good rate. ( just ) 3.14 APR fixed for 5 years, but the criteria to get this was scary. There are hardly any lenders now, willing to do interest only for anything above 50% LTV i was lucky the mortgage i wanted was available to me. Even then though my earnings now fall below there borrowing threshold even though i have a great income and job security. My missus and her earnings has now had to be added to the deal. It is similar to what you mentioned in another thread about getting loans. The advertised rates look good but the criteria for getting them is to hard. My advisor said a good percentage of his customers recently have all got good credit ratings and can afford new deals but they are getting knocked back and just having to revert back to the banks standard variable rate normally 5 or 6 %. :confused:
Thats madness. At the end of my current 3 year fixed rate period, Barclays have already said i can move to their most competitive rate (currently 2.89%) with no charges, and its not a remortgage so LTV is irrelevant.
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The pleasure gained from the mods will have faded long before his final payment.
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See this is the voice of reason in my head too!! ive got a payout and a rate increase in the summer, so ill be in a bit of money then maybe i should just wait!
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Its all relative to income though Andrew, your borrowing that 40K to sort of invest in a long term commitment and you are actually living in the benefit of the investment. This guy is just burning this money away, borrowed or not. The pleasure gained from the mods will have faded long before his final payment.
I am happy to borrow for cars and houses, but i am like Rich for anything else. I only buy it once i have it in the bank.
+ to add to this, cheap borrowing has disappeared.
I have just got back from a visit to my mortgage advisor and it was a real eye opener this time. I ended up with a good rate. ( just ) 3.14 APR fixed for 5 years, but the criteria to get this was scary. There are hardly any lenders now, willing to do interest only for anything above 50% LTV i was lucky the mortgage i wanted was available to me. Even then though my earnings now fall below there borrowing threshold even though i have a great income and job security. My missus and her earnings has now had to be added to the deal. It is similar to what you mentioned in another thread about getting loans. The advertised rates look good but the criteria for getting them is to hard. My advisor said a good percentage of his customers recently have all got good credit ratings and can afford new deals but they are getting knocked back and just having to revert back to the banks standard variable rate normally 5 or 6 %. :confused:
Thats madness. At the end of my current 3 year fixed rate period, Barclays have already said i can move to their most competitive rate (currently 2.89%) with no charges, and its not a remortgage so LTV is irrelevant.
I could have gotten that rate as well but only on 2 year fixed, by the time i have added all the fees again in 2 years it worked out marginally more for the 5 year deal. The problem is future availability of interest only deals the FSA have tightened what the banks can do and instead of looking at cases individually they are just stopping provision.
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i always save the money up to pay for my mods
must be all your tips :wink:
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Its all relative to income though Andrew, your borrowing that 40K to sort of invest in a long term commitment and you are actually living in the benefit of the investment. This guy is just burning this money away, borrowed or not. The pleasure gained from the mods will have faded long before his final payment.
I am happy to borrow for cars and houses, but i am like Rich for anything else. I only buy it once i have it in the bank.
+ to add to this, cheap borrowing has disappeared.
I have just got back from a visit to my mortgage advisor and it was a real eye opener this time. I ended up with a good rate. ( just ) 3.14 APR fixed for 5 years, but the criteria to get this was scary. There are hardly any lenders now, willing to do interest only for anything above 50% LTV i was lucky the mortgage i wanted was available to me. Even then though my earnings now fall below there borrowing threshold even though i have a great income and job security. My missus and her earnings has now had to be added to the deal. It is similar to what you mentioned in another thread about getting loans. The advertised rates look good but the criteria for getting them is to hard. My advisor said a good percentage of his customers recently have all got good credit ratings and can afford new deals but they are getting knocked back and just having to revert back to the banks standard variable rate normally 5 or 6 %. :confused:
Thats madness. At the end of my current 3 year fixed rate period, Barclays have already said i can move to their most competitive rate (currently 2.89%) with no charges, and its not a remortgage so LTV is irrelevant.
Likewise, we're in the process of remortgaging and have defaulted to Hailfax's tracker rate, which is well below 4%. The barrier for most people nowadays is that they are seeing their equity disappear, so when they're looking to remortgage they're not able to achieve the best deals.
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Its all relative to income though Andrew, your borrowing that 40K to sort of invest in a long term commitment and you are actually living in the benefit of the investment. This guy is just burning this money away, borrowed or not. The pleasure gained from the mods will have faded long before his final payment.
I am happy to borrow for cars and houses, but i am like Rich for anything else. I only buy it once i have it in the bank.
+ to add to this, cheap borrowing has disappeared.
I have just got back from a visit to my mortgage advisor and it was a real eye opener this time. I ended up with a good rate. ( just ) 3.14 APR fixed for 5 years, but the criteria to get this was scary. There are hardly any lenders now, willing to do interest only for anything above 50% LTV i was lucky the mortgage i wanted was available to me. Even then though my earnings now fall below there borrowing threshold even though i have a great income and job security. My missus and her earnings has now had to be added to the deal. It is similar to what you mentioned in another thread about getting loans. The advertised rates look good but the criteria for getting them is to hard. My advisor said a good percentage of his customers recently have all got good credit ratings and can afford new deals but they are getting knocked back and just having to revert back to the banks standard variable rate normally 5 or 6 %. :confused:
Thats madness. At the end of my current 3 year fixed rate period, Barclays have already said i can move to their most competitive rate (currently 2.89%) with no charges, and its not a remortgage so LTV is irrelevant.
I could have gotten that rate as well but only on 2 year fixed, by the time i have added all the fees again in 2 years it worked out marginally more for the 5 year deal. The problem is future availability of interest only deals the FSA have tightened what the banks can do and instead of looking at cases individually they are just stopping provision.
Out of interest, why are you going for an interest only mortgage?
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Always have done. They worked out a fair bit cheaper when i started and i also factored in the fact that my borrowing amount was fixed so will be a lot cheaper to afford in 25 years time. My wages and inflation go up every year but the amount borrowed shrinks due to inflation. I did everything with safety margins. the endowments i took out for the final payment were based on 3% growth which at the time was easily achievable, savings rates were 6% then. :signLOL:
The problem has been all the get rich quick guys who borrowed the money, interest only without any investment for the final total. And the banks gave them it because the market was rising. :fighting: And now the same banks are stopping all of this type of lending because of there lack of scrutiny over there own loans. :booty:
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OP - a compromise could be:
- you save £150 per month over the course of a year
- you carry out small, cheapish mods over the year to 'scratch the itch' e.g. shortshift, led lights. There is a thread somewhere with 'best mods under £50' or words to that effect.
- at years end you have a pot of cash to do your big mods or blow in Stringfellows
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Ive never had a loan in my life with the exception to Student Loan and mortgage... if one cant afford it... dont buy it :happy2:
i think this is right.
dont think it would be wise personally to do it that way but etto
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Loans to mod?
Ok i will have £ 10,000 :innocent: not paying more than 5% APR though. :happy2:
PM me for bank transfer details. :happy2:
:congrats:
Not a fan of credit but it more than has its place today, just not the way I was bought up. My parents would say "if you haven't got the money, you can't afford it".
I use our retirement fund savings! :rolleye: I even have the blessing of SHMBO as she gets to spend the equivalent on herself, £1k since Christmas on handbags and perfume (her not me)
If you can afford the repayments then why not.
:happy2:
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personally id do it month by month depending on what you can afford.
Buy 2nd hand an item a month or one over 2 months, keeps you happy and your not paying interest nor are your mod losing that much value
IMO
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Ive never had a loan in my life with the exception to Student Loan and mortgage... if one cant afford it... dont buy it :happy2:
I subscribe to Oscar Wilde's theory:
"Anyone who lives within their means suffers from a lack of imagination"
Seriously though. We put £40k into home improvements last year, largely financed by a loan. We've done exactly the same in the past. The way I see it, I can benefit from it now, or I can scrimp and save for years then finally get it. Essentially you've got to be able to afford the loan, so what's the difference. If you're prepared to pay and the finance is cheap then why not?
Home improvements/extensions are different as you will actually see a return on your investment.
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do it!!
save the economy :grin:
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I have really just been modifying my car month by month, its scary to think about the amount of money I have spent so far on mods but at least they are paid for.
I would hate to still be paying for them and wishing I never botherd with the mods.
If you are saying that you will have to cut back on a few luxury s to pay the loan what will happen if for example the clutch goes and you have to find a large sum of money to get it repaired?
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Don't finance mods, save the money!
From my experience there's nothing worse than still paying for something once the initial joy/novelty value has worn off and you want 'the next thing' whilst still paying for the last.
Plus what you may find once you have saved the money is it will make you question how much you REALLY still want those mods as you see your stash of savings disappear.
God luck on whatever path you take :happy2:
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Your here for a good time, not a long time! :jumpmove:
Could be dead tomorrow and not have experienced the slippy slope of modding! :laugh:
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Go for it !! If the repayments are not a problem SPEND SPEND SPEND !!!
Every car I've ever owned has been funded via a loan and if I want something for my car like coilivers it goes on my credit card !
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Go for it !! If the repayments are not a problem SPEND SPEND SPEND !!!
Every car I've ever owned has been funded via a loan and if I want something for my car like coilivers it goes on my credit card !
^^^^^^^^^^ THIS! :happy2: