hi all, new here so hope its in the right place! (deep breath) here goes:

february 2009 i bought a car with a price of £10,150. part exed my old car for £4000 so took out a finance agreement with creation finance for the £6150 over 4 years. up to now i've paid £1305 off the balance. the first re-payment was £250, and the following monthly payments have been £175.

i've looked on the net and my car currently has a value of around £9000. i'm interested in another car now (yes i know its only been 8 months!) which will cost around £10000. i've considered many options including getting credit
cards to settle the finance then pay the cards back in the 0% periods in order to buy the new one. but as i also have a loan from a previous time, my credit reprt says im already using around 93% of my affordable credit, which is rejecting me the cards.

another option i thought about was if i could part ex my current car for the new car, then the dealer paying off my finance and whatever is left could be my deposit on the new one. then getting finance (again!) for the remaining balance on the new one! as ive made all payments on time for the finance so far, how considerate would creation finance be in setting up a new finance agreement for me? i appreciate it will not just be a case of swapping vehicle details and telling me a new amount to pay, but i really don't know much about this sort of thing!

so if anyone could tell me my options i may have or anyone has any opinions (good or bad) , id greatly appreciate it.

thanks,

kev

p.s. just to add, although the current situation is easily affordable for me, getting the new car would reduce service costs, running costs etc. so is really appealing to me.

Hi

The best option is to speak to creation finance about this. As you say any new finance would just add the extra amount involved for trading in, to buy the other car.

Before you ask about finance check with the garage exactly how much they would offer for your current car, against the one you are looking at.

I would have suggested shopping around for finance, including a quote from the garage concerned, but with the current amount of credit you have, perhaps this would be difficult to get at a decent rate.

Huckster

ah ok , so speak to the garage and get the quote first, then speak to creation saying what the garage are willing to pay for my car as a part ex? i don't suppose you know if this is a regular thing to happen do you? as i cant imagine everyone who gets finance will keep a car for the full 4/5 years etc? i'm hoping so and there's already some sort of procedure in place for this eventuality, as (foolishly) i've set my heart on the new car now! any advice appreciated,

kev

Kev

From memory the garage check or ask for outstanding details of the amount outstanding to creation. This information will be entered on the purchase form for your new car. They the take off the trade in value for the new car. Your current creation account would be paid off, leaving a credit balance and this would be used with the new finance arrangement to buy the new car. The end result will be that you end up with a new finance agreement for a higher amount.

So first obtain trade in value, then approach creation, to see if they can replace with new loan for your new car. You could obtain finance elsewhere to settle the creation account and have a new loan. The only issues with this are, will creation allow you to end finance without any penalty fees/interest and can you obtain finance elsewhere anyway.

Garages come across this situation on a daily basis, so they will explain what happens. Ask for trade in value, but don't put down a deposit until you know you can definately finance. If you failed to get additional finance, the garage could be slow in refunding any deposit and could retain an amount to cover admin costs. You could ask the garage for a quote for the loan. Some garages can provide competitive loans, so may be cheaper, but as I said be careful about any charges that creation might make if you ended finance arrangements with them, before you decide.

Huckster

ok thanks a lot for that, excellent explanation.

kev