# Need advice re car loan.



## beetlebrain (3 Jul 2007)

Im new to the site hope im posting this where it should be. 

Ive got myself into a bit of a pickle. I applied for a loan of ge money for 24,000 for a new car. They said ok that has been accepted, just send in copy of id, a bill, and 2 payslips. I did this and was told the loan would be in my account in 3working days. It wasnt so i gave them a quick ring and they said that the underwriters had decided not to approve the loan..even though i was told it was approved. They didnt even ring me to tell me. I made a complaint. I went ahead and ordered the car which is now waiting for me. I am waiting on boi to get back to me about a loan. aib have declined me. I'l tell you a little of my history. boi loan of €4,300 Cleared and I have one credit card at €4,500 no payments missed but i let it go overdrawn by 200. Im 21, and a home owner. Mortgage about 1000 pm. earn approxx 40k 

I honestly dont know what to do. Should I apply to the garage for car finance? or will they just go threw the same people as ive asked? Does anyone else know where else i could look for a loan? also could anyone give me an insight as to be why im been declined? very depressed poster


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## ClubMan (3 Jul 2007)

beetlebrain said:


> I'l tell you a little of my history. boi loan of €4,300 Cleared and I have one credit card at €4,500 no payments missed but i let it go overdrawn by 200. Im 21, and a home owner. Mortgage about 1000 pm. earn approxx 40k
> 
> I honestly dont know what to do.


Maybe you should seriously reconsider incurring an additional €24K of debt (probably 75% of your net earnings!) on top of what you already have? 

Why not buy a cheaper or second hand car if you really need one?


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## RaboDirect (3 Jul 2007)

Beetlebrain,
You'll probably find that based on your net income combined with your mortgage payments plus a relatively high outstanding credit card balance that lenders could be declining you as you are in danger of overcommitting yourself. You also need to take into account the running costs of the car - tax, insurance, petrol, servicing. 

In your case your monthly net income is probably around €2800 per month? Your mortgage repayments account for approx 35% of your net monthly income already and the additional loan repayments would bring this to 60% mark before you've taken your credit card debt into account. The reality is that you cannot afford this level of debt which I guess isn't much comfort seeing as you've ordered the car.


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## Macer (3 Jul 2007)

beetlebrain said:


> why im been declined?


 
By my calculations after paying your mortgage, your disposal income is around €370 per week, try stress testing your mortgage repayment capacity by 1% and you will be left with just over €300. Your credit card is maxed out @ €4,500 - take your monthly credit card payment & everyday living expenses into consideration as well as a "rainy day fund" and you want to buy a €24K car. I work in the motor trade, just love people like you, we call it the "where do I sign - punter" simply fact is you can't afford the car.
Your a home owner, think outside the box, there is earning potential there (if you really want that car), rent a room (tax efficient).
Finance houses are beginning to tighten up and are not as loose as years gone by. Could you get anyone i.e,. a parent, to guarantee the car loan, the finance companies love that one. Best of luck !!!


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## beetlebrain (3 Jul 2007)

Thank you guys for the replys. Ok so I was very haste and ordered the car, i realise now that I should have waited untill I had a loan sorted. Macer..i dont wanna go back and tell him i cant buy it after him getting it for me. I guess i could get a good 2nd hand car but now that its there i guess i want it.

Too make it clear, the boi loan i had is cleared, and has been over a year. Its just the credit card, im paying it of in chunks at the mo trying to clear it. Min monthly repayments are about €100. I've never thought about renting a room, thats something i could look into. Im only in the house at the weekends really, as i work in dublin and stay with my parents some nights. I could get them to go as guarantor but I'd rather see if I could get loan myself without bothering them. I've some savings in the bank (which would buy a car) but i was hoping to build them up for emergiences, rainy days, if the heating ever broke in house etc. 

I have looked over my money etc and I would be able to repay the 24k.

Anyways thanks again for the advice, il see what tomorrow brings..

btw macer..do you think the dealer will charge me anything for messing him about with the car?


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## ClubMan (3 Jul 2007)

beetlebrain said:


> Macer..i dont wanna go back and tell him i cant buy it after him getting it for me. I guess i could get a good 2nd hand car but now that its there i guess i want it.


Reality check - can you afford it? I suspect not.


> Its just the credit card


 And the little matter of your mortgage?


> im paying it of in chunks at the mo trying to clear it. Min monthly repayments are about €100.


 If you just make minimum repayments you will probably *never *clear this!


> I've never thought about renting a room, thats something i could look into. Im only in the house at the weekends really, as i work in dublin and stay with my parents some nights.


 Do you mean that this property may not actually be your _PPR _and so you could also have outstanding tax issues here?


> I have looked over my money etc and I would be able to repay the 24k.


 Care to post your outline budget plan covering all incomings and outgoings?


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## RaboDirect (3 Jul 2007)

Beetlebrain
The last thing you need is more debt right now (and that's coming from a bank that lends people money!). Sort out your credit card debt as you're likely to be be paying around 15% in interest. You need to get a budget together that details all of your living costs and your income + savings. stress test yourself for higher mortgage repayments. You'll then have a better idea of where you stand. Maybe you'll be able to afford a second hand car for less than 10k from your savings. If you keep applying for personal loans and are declined this will appear on your profile at the Irish Credit Bureau and will be seen as a negative by lenders. Lenders want to see that you are able to manage your finances when they consider you for a loan. A 24k loan is just out of the question for you based on the high level info you have provided. 

RaboDirect


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## Macer (4 Jul 2007)

Beetlebrain - Garage may try it on and charge you for messing them around, especially if this was a special order. Better to go and speak to them as early as possible and explain. Have you already paid a deposit ????
In relation to Clubman comments re. outstanding tax if the house you own is not your PPR. Just because you stay with your parents regularly doesn't mean that its not your PPR, even if you rent out a room. It still your main base, so you have no worries there.


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## bacchus (4 Jul 2007)

Very similar post here also involving GE money and aib. Tesco Loans was the solution.


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## RaboDirect (4 Jul 2007)

bacchus said:


> Very similar post here also involving GE money and aib. Tesco Loans was the solution.


 
Based on the limited info provided by the OP taking on more debt, certainly at levels over 10k, is not the solution to his/her problems.


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## ClubMan (4 Jul 2007)

Macer said:


> In relation to Clubman comments re. outstanding tax if the house you own is not your PPR. Just because you stay with your parents regularly doesn't mean that its not your PPR, even if you rent out a room. It still your main base, so you have no worries there.


I never said that it was not his _PPR _- I just said that there is insufficient information posted to say for sure. There is no way that you can say that he definitely has no tax issues in this regard. This could be a pertinent issue for somebody who already has problems with debt - an outstanding tax liability *should it arise *could put them under even more pressure.


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## beetlebrain (4 Jul 2007)

Thanks to all for the information. I got approved from boi for 20 but must clear the credit card with it aswell they said. Rabo thanks for the very good info i realise now i was a bit hasty but i can afford to pay for the car, i wouldnt be doing this if i couldnt. 

Macer, i didnt have to pay a deposit when ordering the car.

Clubman, i dont have any tax issues. I just stay with my parents some nights if working overtime or out in dublin. Maybe 2/3 nights a week. My home is my home. I never said I was making the min payments on the credit card. I simply said the min payment was 100 and that I was trying to pay it of in lumps now. Anyways, im clearing it with the boi and reducing the limit to €500 and I already have it cut up, in the bin.

Thanks again.


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## beetlebrain (4 Jul 2007)

bacchus, I actually had a read through that post yesterday. thanks for the link.


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## ClubMan (4 Jul 2007)

beetlebrain said:


> Anyways, im clearing it with the boi and reducing the limit to €500 and I already have it cut up, in the bin.


Why are you bothering to reduce the limit if you are ditching the card? If you are doing this don't just cut it up - make sure to cancel it with the card provider once you have cleared the balance otherwise they will probably reissue the card when the time comes and you will be charged another €40 annual stamp duty.

I still think that you are very foolish to consider taking on even more debt given what you already owe but you have obviously made your mind up so good luck with it...


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## Macer (4 Jul 2007)

ClubMan said:


> I still think that you are mad


 
Clearly thats his own business, I think me has realised the error of his ways and has made adjustments, best of luck to him.

I also think my opinion on any likely tax liability was justified, from what he had posted, there clearly was no further liability.

Thanks however Clubman for keep me in check.


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## ClubMan (4 Jul 2007)

Posting on a public discussion forum opens up his business for comment from others.

I stand by my comments on the house tax issues - at the time there was no way to say for sure that they did or did not arise so I felt it prudent to mention them and the possibility that there might be an issue.


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## KalEl (4 Jul 2007)

beetlebrain said:


> I dont wanna go back and tell him i cant buy it after him getting it for me. I guess i could get a good 2nd hand car but now that its there i guess i want it.
> 
> Too make it clear, the boi loan i had is cleared, and has been over a year. Its just the credit card, im paying it of in chunks at the mo trying to clear it. Min monthly repayments are about €100. I've never thought about renting a room, thats something i could look into. Im only in the house at the weekends really, as i work in dublin and stay with my parents some nights. I could get them to go as guarantor but I'd rather see if I could get loan myself without bothering them. I've some savings in the bank (which would buy a car) but i was hoping to build them up for emergiences, rainy days, if the heating ever broke in house etc.
> 
> ...


 
When I read this post my first thought was the house wasn't his/her PPR and there might be stamp duty/tax implications so Clubman was right to post what he did.
Buying this new car is outrageous behaviour given the OP's financial scenario...as is having savings while simultaneously maintaining credit card debt.
You need to ditch the credit cards permanently and ditch the idea of buying this new car-you can't afford it, simple as that. Don't worry about not having a credit card for tickets etc, you can purchase prepaid voucher type things which perform the same function.
There is no shame whatsoever in cancelling a car you haven't paid a deposit for...with all due respect you do sound like a good candidate for the hard sell anyway!


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## Macer (4 Jul 2007)

What part of "I'm a home owner" isn't clear !!!!
People need to read post maybe more that once if their first thoughts are as displayed on this thread.
Still believe that mentioning a tax liability was way off track & might have just freaked out this young person, but that my "opinion".
Fully agree with Clubman that "Posting on a public discussion forum opens up his business for comment from others" but once that person has made up their mind after taking on board the advise given, then thats end of story and people should certainly not be accused of being "Mad" a term clearly used too loosely in this and many other situations.

I suspect that the garage will not try and charge you anything for changing your mind, althought I don't take it as lightly as Kalel when he says there is no shame in cancelling the order. Garages must run a business also and obviously took this order in good faith (without a deposit), what say your order was for some colour which is normally difficult to sell, the garage might still be looking at this car in stock this time next year having paid for the vehicle within 2-3 months of it arriving on the forecourt. It happens believe me I know.


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## bacchus (4 Jul 2007)

Bacchus said:
			
		

> _Very similar post here also involving GE money and aib. Tesco Loans was the solution._


 


RaboDirect said:


> Based on the limited info provided by the OP taking on more debt, certainly at levels over 10k, is not the solution to his/her problems.


 
I am not here to judge the level of debt the OP should or should not take...I am simply providing an answer to one of the OP's question.


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## ClubMan (4 Jul 2007)

Macer said:


> What part of "I'm a home owner" isn't clear !!!!


This part...


beetlebrain said:


> I've never thought about renting a room, thats something i could look into. Im only in the house at the weekends really, as i work in dublin and stay with my parents some nights.


By itself this is enough evidence for people to question whether or not this property was, in fact, the original poster's _PPR_ and, if not, what tax liabilities might be outstanding which would obviously have an impact on the original poster's ability to service even more debt.


> People need to read post maybe more that once if their first thoughts are as displayed on this thread.
> Still believe that mentioning a tax liability was way off track & might have just freaked out this young person, but that my "opinion".


 Well I disagree and I suspect that _KalEl _does too.


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## Guest126 (4 Jul 2007)

It sounds pretty darn like a PPR to me.


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## DrMoriarty (4 Jul 2007)

Thread reopened after removal of some off-topic comments.

Let's keep the discussion to the merits/demerit of the car loan issue rather than offering broader value judgements?


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