Car Loan: Why car loan company don't want to finance if I want to buy an old car?

Lphokati on 13/06/2014 - 01:16

Hi All,

Just as the topic says. I recently applied at NRMA for a small amount of car loan as i was thinking of buying a used old Nissan imported car.

When i contacted the NRMA team regarding my loan i was advised that i cannot get loan if i am buying a old/imported/sports car

I don't understand how does my decision to purchase a old car instead of new one in any way affects the Loan provider, How does it affect my ability to repay the loan.

I spoke the Representative on phone but he could not explain me and said that's how all other finance companies work.

I dont want to get a brand new car and spend a whole lot, my current car is about to die so i was thinking of buying a 5 - 7 K car and that's the loan i applied for. I can pay it off in a year.

Can someone please elaborate on this one !!

Financial

Comments

  • Shadowsfury on 13/06/2014 - 07:21
    +3

    Because should you default they're going to have a much harder time recovering their money when selling the car you choose than if it was a regular car easily purchased here. Market would be much smaller for the kind of car you're looking for and so harder to sell.

  • itsdanthaman on 13/06/2014 - 07:26
    +1

    as mentioned, the car may be worth 5-7k now, but after a couple years if you fail to pay it off, the bank will only have a car worth nothing to sell, and even then only to a small niche market.

    what ive done in this situation is, apply for a 5k credit card, and withdraw as cash (21% interest) or if your patient, try to pay via eftos and live off the card, whilst pocketing the cash you would normally live off, that way interest on the card is only 13%

  • spersephone on 13/06/2014 - 08:20

    Edited - duplicate

  • spersephone on 13/06/2014 - 08:21
    +1

    This would normally be done through a bank as a personal loan. Finance companies simply don't offer those sorts of loans.

  • itsdanthaman on 13/06/2014 - 08:21
    +2

    regardless though, it seems you pretty financially strapped, why would you play around with old imported jappers? Sounds like a you need a boring reliable but cheap ride. Something like an AU falcon solid cars, easy and predictable to work on

    • [Deactivated] on 14/06/2014 - 02:10
      +1

      ^ Seriously this. You're not going to love your grey import skyline when you start haemorrhaging cash with insurance and unexpected servicing / repair costs. Same for any old European car.

      Smartest thing is modern and low kms as possible like TK Barinas and Getz you can get 2009-2010 models in your price range. A bit older you can get a Fiesta which was regarded more of a drivers car (I actually bought one of these myself in my more cash strapped days, punchy and great around corners).

      If city cars don't do it for you, Falcodores are a good suggestion except at this price range the kms may be quite high.

      Other main suggestion would be the circa 2004-2005 ZZE152 Corollas, hold a bit too much resale for my liking but you get the famous Toyota reliability.

      • phokati on 16/06/2014 - 18:52

        I will be buying those proper good family sedans later but considering i am young i want one of those skylines too, i guess if you find a good one they are pretty reliable. More spending on fuel but its worth it.. and i am not really spenindg 20 -30 k do dont matter couple of years of use of a decent skyline should be satisfying for me.

    • phokati on 16/06/2014 - 18:50

      I dont have money saved up, but i earn good money but i just cant save it up so i was thinking of getting a quick loan for 5 - 8 K and pay it off in a year and enjoy my new car as well at the same time.

      I am young so wanted one of those skylines you know.
      Before time is over i might as well get one and have fun, will end up buying a New family Sedan laters anyways..

      I guess i ll have to go with personnel loan..

  • Malarkey on 13/06/2014 - 08:58
    +2

    For such a small loan I would just get a personal loan from whoever you bank with already, then open up a new creditcard with a good 12month balance transfer (I did mine with citibank a few years ago). And balance transfer the loan amount to your cc and enjoy your 2% loan ;) Obviously do some research first to see if your credit card provider will let you BT loans.

    • itsdanthaman on 13/06/2014 - 09:04

      problem is a bank isnt going to give you a loan if your credit history shows you recently were approved for a loan through someone else. All depdending on income of course…

      • phokati on 16/06/2014 - 18:53

        Thanks mate but i checked with the NRMA they said they dont do any further checks until they speak to us. So all they recweived was just my application and when they we realized its no suitable for us we did not go ahead.

        So no mark on the credit history - Good

  • phokati on 16/06/2014 - 18:47

    Thanks for all your reply guys , sorry almost forgot i posted this. First couple of post made it clear. Thanks again.

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