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Property Dreamer

Merc On A Mortgage

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Looks like this brain has seen the easy way to 'enjoy' ownership of a new Mercedes Benz. No pre-owned, second hand carriage for this ohh ohh. All this and the bonus of 'consolidating' all his debts. Maybe he could put a well deserved foreign holiday on the mortgage as well? God bless this ATM.

Putting the Mercedes on the mortgage

Paul Wallis, 36, a project manager from Tircoed Forest near Swansea, found there was no question over which was the best way to finance his new car, a Mercedes C-class, when he bought it earlier this year. He added it to his mortgage and saved a small fortune.

“The main reason was convenience, and I wanted to consolidate all my debts. Since I have been with my mortgage lender for 10 years it seemed the simplest way,” he says. “I started looking at hire purchase rates and other loan rates and I realised that they were all 7% APR or higher whereas my standard variable mortgage rate was only 5.5%.”

Wallis opted to take the loan out over the full length of his mortgage — about 20 years — to keep the monthly repayments low but says he intends to pay off the loan within the next five years when he comes to sell the car. “It gives me the freedom to pay off as much as I like without penalties.”

Here's the link:

http://driving.timesonline.co.uk/article/0...1732590,00.html

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Looks like this brain has seen the easy way to 'enjoy' ownership of a new Mercedes Benz. No pre-owned, second hand carriage for this ohh ohh. All this and the bonus of 'consolidating' all his debts. Maybe he could put a well deserved foreign holiday on the mortgage as well? God bless this ATM.

Here's the link:

http://driving.timesonline.co.uk/article/0...1732590,00.html

Whats's wrong with that? Seems like he's sensibly saving money!

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ADDING IT TO YOUR MORTGAGE

Cons: By the same token the long loan period can outweigh the low interest rates — meaning the final cost of the car is more. No maintenance will be covered and if interests rates go up and you are not on a fixed-rate mortgage then your repayments will go up too

LOL, they forgot to mention that the liabtility for the loan on the car is now tied to the house.

<I>Wallis opted to take the loan out over the full length of his mortgage — about 20 years — to keep the monthly repayments low but says he intends to pay off the loan within the next five years when he comes to sell the car. “It gives me the freedom to pay off as much as I like without penalties.”</I>

Better start saving then because in 5 years you'll have bitten off the largest deciation years of the car - probably down to around 25/30% of its initial cost.

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He added it to his mortgage and saved a small fortune.

In an ideal world people would be arrested for making statements like that.

Assume the Merc costs 25k new.

For a 20 year mortgage at 5.5% , monthly repayments are 171.90.

After 5 years £21,047 would still be left outstanding with 6,365 paid in interest.

What would the Merc be worth after 5 years?

Probably around the 10k mark.

says he intends to pay off the loan within the next five years when he comes to sell the car

:blink:

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Guest Charlie The Tramp
LOL, they forgot to mention that the liabtility for the loan on the car is now tied to the house.

No problem, if he loses the house he can always live in the car, and that is paid for. It would have been better if he had bought a Volvo Estate. I would have given him my tifter and leather gloves as a moving in present :D

Edited by Charlie The Tramp

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No problem, if he loses the house he can always live in the car, and that is paid for. It would have been better if he had bought a Volvo Estate. I would have given him my tifter and leather gloves as a moving in present  :D

How come you don't stick your tongue out anymore ?

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How come you don't stick your tongue out anymore ?

As far as I can see Charlie’s tongue sticking out okay. I think he works as a volunteer patient in a medical school and there’s a queue of students asking to see it.

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He added it to his mortgage and saved a small fortune.

In an ideal world people would be arrested for making statements like that.

Assume the Merc costs 25k new.

For a 20 year mortgage at 5.5% , monthly repayments are 171.90.

After 5 years £21,047 would still be left outstanding with 6,365 paid in interest.

What would the Merc be worth after 5 years?

Probably around the 10k mark.

says he intends to pay off the loan within the next five years when he comes to sell the car

:blink:

It is quite possible to overpay on most mortgages these days. This renders most of the arguments about paying for it over 25 years meaningless. An offset mortgage is another vehicle that makes this less clear.

A friend has done something very similar, and the numbers do add up if you are sensible.

i) He has bought a very low depreciating car.

ii) He overpays the mortgage. Consider that he has a "budget" of his monthly car allowance in lieu of a company car net of tax, PLUS the company car tax he doesn't pay (about £150pm)

iii) Driving an old banger around is not an option for a car used on business.

He will probably have paid for it in five years, it will be worth the best part of £10K even then, and he will have had the pleasure of driving around in a nice car during that time. Of course, if he should lose his job and be unable to find another job with similar pay, then he will have made his situation worse through this, but if the status quo is preserved, then he will be OK.

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If we take as red that the guy is going to buy the Merc and doesn't have the cash up front (the wisdom of that can be questioned but that isn't what this thread's about), he's just looking for the best way to finance the car.

Adding it to the mortgage at 5.5% is certainly the best way to buy the car, make the same over payments to the mortgage as you would have made on a regular car loan then when you sell the car clear the remaining debt as you would with a regular car loan. This could save close to £2k over 5 years on interest payments, there's no cheaper way to finance the car.

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he's just looking for the best way to finance the car.

I heard a story about a collegue of my Dad. He worked part time as a male stripper (the collegue NOT my Dad before someone says it) and saved up the extra cash to buy his dream car (a Lotus if I recall correctly). How's that for a way to finance things?

Anyway, the sad ending to the story is that he was driving his new pride and joy down a country lane when a cow (yes that's right, a cow) jumped over a hedge and landed on the bonnet. The car was a write off and the cow ran off uninjured. You can't make it up!

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I heard a story about a collegue of my Dad. He worked part time as a male stripper (the collegue NOT my Dad before someone says it) and saved up the extra cash to buy his dream car (a Lotus if I recall correctly). How's that for a way to finance things?

Anyway, the sad ending to the story is that he was driving his new pride and joy down a country lane when a cow (yes that's right, a cow) jumped over a hedge and landed on the bonnet. The car was a write off and the cow ran off uninjured. You can't make it up!

Reminds me of a cow joke...

A farmer had been ripped-off several times by the local car dealer. One day, the car dealer informed the farmer that he was coming over to purchase a cow. The farmer priced his unit as follows:

Shipping and handling 35.75

Extra stomach 79.25

Two tone exterior 142.10

Produce storage compartment 126.50

Heavy duty straw chopper 189.60

Four spigot/high output drain system 149.20

Automatic fly swatter 88.50

Genuine cowhide upholstery 179.90

Deluxe dual horns 59.25

Automatic fertilizer attachment 339.40

4 x 4 traction drive assembly 884.16

Pre-delivery wash and comb 69.80

FARMERS SUGGESTED LIST PRICE: 2843.36

Additional dealer adjustments: 300.00

TOTAL LIST PRICE (Including options): $3143.36

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  • 302 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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