[Closed] How to finance an exotic car

Savings/Bank Loan/finance through the dealer.....?

Bloke at work bought an 06 plate Aston Martin Vantage V8 a couple of years ago.
Cost him £36k, I think.

I don't think the insurance is as bad as you'd expect because it's on a low annual mileage.
But, VED is £500 I think & the last time he had it serviced it cost him well over £1k.
He reckons he gets about 18mpg driving it normally, so a weekend away in it costs quite a bit just in fuel....

I think he's bonkers but he is mad into his cars. He's got a trackday car that he uses probably 10 times/year and a TVR 'project' car that seems to have been a 'project' as long as I've known him (about 4.5 yrs).

I think he's mad buying the Aston as it doesn't get used much & costs him a lot of money. He reckons prices have stabilised & dealers are still selling his age of car for similar money to what he paid for it....
I think it was an expensive treat to himself; he's ex-RAF so has a decent pension, is paid a reasonable sum I expect based on what he does, has paid his mortgage off & has no kids........so why not!!?

There are a few finance companies out there that will cover older cars. I've had a few but there are some conditions that wouldn't apply to a newer vehicle. For a start you can't do a PCP/H type deal as they can't underwrite the value in X number of years, so it tends to be HP only. You can also normally only take it over two years.

The only marque that seems to be ok is Porsche, probably because they hold their money so well. The other half has a '59 plate 911 thats actually increased in value in the 4 years she's owned it.

Problem is, a £70k+ new car might be available now for say £25k, but its still got £70k+ running costs.

Simple, exotic cars of that age don't depreciate so the annual loss via depreciation is zero. In fact many 10-20 year old rare cars are appreciating now.

Friend of mine bought a classic Ferrari 3 years ago for around £25k which he ran as a daily drive for 2 years. Cost him he recons £10k in maintenance during that time and probably £3-4k more in fuel/insurance over a standard car but he sold it at the end of the 2 years for £45k

So he made a profit of around £1k over two years and got to drive a Ferrari.

Compare that to if he'd have spent £25k on say a new Ford Mondeo. After 2 years that would have been worth around £15k, perhaps less. So a £10k loss over 2 years!

In his eyes driving the Ferrari has made him £11k richer (and a whole load happier which I guess you can't put a value on). Can see where he's coming from 🙂

Lease?

https://www.allcarleasing.co.uk/car-leasing/ferrari/458

I think drug dealing is the usual method.

Just buy a Macan?

You can finance any of the exotic cars, both new and used through any of the methods you mention; PCP, PCH, HP, non secure personal loan.

It comes down to cost and what suits you. What you'll find is that all the lease/hire options have extortionate interest rates (I've seen 12.9% on an Aston!), versus a personal loan of 5% (or less).

However, the lease options will often include some benefits, such as warranty, servicing and breakdown cover to try and encourage you to take their inflated interest option.

The best option would be to take the lease, but then swap to a personal loan within 14 days so you don't incur any interest payments. This way you retain any benefit of taking the lease, but pay the lower interest. You also have the option of selling the car at anytime if you take a non secure personal loan.

Just because the car is the price of the Golf, it won't be the same price to run it. Service costs and consumables still match the cost of the original car, or possibly higher due to the age of the car. Can you afford the car if something major breaks or a major service? Can you afford the depreciation if you pile on the miles like a Golf?

The other side of the coin is that if you buy wisely, you could end up with an appreciating car, which can offset the running costs. You still have the bork factor risk, but if you keep use moderate it could be an investment.

My brother and I are doing this at the moment. Just a nice car to stick in the garage and use for a few thousand miles a year over summer. We've done months of research and are settling for something that ought to appreciate nicely.

Easiest way is personal loan or increase the mortgage.

OP as per other threads recently my 9 year old Cayman is worth about £15k+ OP obviously maintainece costs will be much higher than a new car but plenty of excellent specialists around. Note VED will be £500

Depending upon milage and budget / parking space imo a £15-20k classic and a £2-5k bike/commuter makes sense

Cheaper than paying the hookers?

I didn't deal or take any drugs when I bought my current one, I wish I had though.

Its swings and roundabouts. I have a mate who bought an Italian supercar for £75k about 3 years ago. Its worth over £200k now. He was financed up to the eyeballs but its worked out well, he can now sell it, pay off his mortgage and have change left over to buy something newer outright.

On the flip side, in a moment of madness I bought an M6 for £25k, it seized solid and now I'm looking at spending a fortune to have it rebuilt (to the point where its nearly ruined me!).

There's a lot to be said for buying something that you know is going to work every time you turn the key. And if it does break, it won't cost you a fortune to fix it. If you buy something older, keep in mind that it will break and it'll need a lot of money spent on it. There are always those who get lucky, but luck is no friend of mine and I've learnt my lesson.

or increase the mortgage.

I'm a fool with money but even I wouldn't do that...

My 911 has been remarkably cheap to run. Some coil packs and a fuel pump relay are all its needed in five years apart from the annual servicing & some tyres.

Looks like it's not depreciated either.

Crappy commuter + nice weekend car works well for me.

There are some high end car finance companies out there like Oracle but getting a bank loan might be just about the same cost.

I'm liking all the crazy car buying stories. Glad I'm not the only one

Coming across exotics such as a Aston and Porsche that are about the same as a new golf or focus

Why do you think they're cheap? Cos they cost a fortune to run and maintain, I'd expect.

Check the running costs and make sure you factor them in..tyres and brakes especially.

yea all good points on the running costs

if you buy the right model on the cheaper VED side an identical car can be c£200 a year less to tax.
running costs wouldn't be too bad; have a family car and co. car for the daily/mundane.
problem is; I don't need 1, just would like 1!

Mate of mine bought an Aston for about £35k was planning on running it for a year and then selling on, it's not been a happy tale 🙁 vehicle history is very important in this field & yes £500 ved ouch

This was my field when I worked in finance, for the most part anyway. I financed a lot of exotic stuff, some older stuff like F40s and F50s and something from the 1920s, I forget what it was called.

It's problematic because "Ferrari Finance" as it was called was a hotbed of fraud in the 2000s because of a simple loophole in finance company procedure which made it much tighter.

As for financing it, the problem you face is that by the letter of the law, if you buy a car with HP, PCP etc, then the finance company technically sells you the car, even if they're almost never the real seller. So if you buy your 10 year old DB9 for £30k or whatever instead of a new E Class for example (you're not the first person to have thought of doing it) and it turns out it's a pup with a long list of problems then your legal recourse is with the finance company, they can of course pass that back to the dealer, but it's not always that simple.

So, it varies but when I was at Lombard the rules were, no more than 5 years old at purchase and no more than 8 years old at end of agreement. It didn't matter if it was a Vectra or a Veyron, that was the rules.

The only way we would finance something outside of that would be via the HNI rules (high net-worth individuals) which means you needed to show assets or equity of £2m total, or liquid assets of £1m or a combination of the two. Then we'd finance an 1989 F40, or 1920's thingamabob.

So, you need a personal, unsecured loan - due to new affordability rules you need a very good income/expenditure ratio to get a £20k loan. Which is handy, because these things can cost fortunes to run.

Another thing to consider, whilst high end cars don't depreciate like normal cars, that doesn't mean to say they don't they certainly do – at the moment classics and high-end cars are more expensive than they have been for years and years. People are buying as an investment, and it's got all the signs of a bubble. If you want to buy a nice older car for the sake of owning and enjoying it - great, if think you can buy something now and sell it again in 3 years for twice as much, or the same then maybe you can, maybe you'll lose 75% in a month. Using it will depreciate it either way, unless the market out paces you.

I've thought about this quite seriously, and I only lust after a slightly exotic car (Elise S1).

I think you would ideally want to save up the cash. That way you'll be able to take out credit if needed for repairs (but hopefully you'll have put enough away after buying it). It's obviously not something you need, but neither is a mountain bike, so that's no reason not to spend all your disposable income on it. Just make sure you don't do that and then end up with a pile of scrap metal that you can't afford to fix.

an identical car can be c£200 a year less to tax.

I think £200 is barely relevant. £500 ved?... if you care about that why are you even thinking of a car like this?

The VED is absolute chicken feed in the costs of running any car. What do you think a set of spark plugs or an air filter for £150,000 car are going to cost? What do you think an exhaust would cost? Do you think anyone would offer you finance for them?

If it's an itch you need to scratch...you could hire something nice or make like a customer and get some test drives..

You can get finance for a 10-20yr old exotic like the OP asked and if you buy well then you could largely remove the depreciation you get on a new car (as posted by a few people above) making running a car on a specific budget possible. However it's much more of a gamble than buying new. The classic car bubble that we are in might burst and something major might go wrong and you could lose a bunch of money. Just go in with your eyes open and do you research.

Also as posted above it's not simple service items (spark plugs / air filters) that are the killer for costs its the £1000 for new brakes, £1000 for four tyres or anything bespoke like electrical items.

You can pay £500 VED on a Volvo though, hell even mine is £290 on a Civic.

Exotic can be fun, but finding a sleeper is even more. What's the best thing you can get that just looks normal?

Having said that I went to the BMW garage the other day and looked at the new M3, £65k for a nearly new model, I left soon after, how do people justify that to themselves?

I bought a £35k car back in my 20's (it was more than my annual salary), I did it by putting it on my mortgage lol (I was lucky in that I had a lot of equity in the house). Obviously don't do this unless you actually want to pay enough for a new Ferrari over the course of the loan, that said I don't regret it hugely. OK if I hadn't I could probably be mortgage free now, reduce to a 4 day week, have some savings in the bank but I had a decent car for a while...doh

£1000 for 4 tyres isn't out of the ordinary for 'normal' cars these days.
A builder friend was paying north of £300 for one tyre for his Q7

A mate just had to replace two tyres on his Aston as he had a puncture in one and that came in at £800 for the pair.

It may be a sign of the times but I agreed that wasn't that horrendous considering the price of some for an X5/Q7 type motor.

I'm sure most people don't pay for these nice cars themselves. They are probably company cars.

My car allowance is enough for a new A6.

£1000 for 4 tyres isn't out of the ordinary for 'normal' cars these days.

Wot?

£90 each for premium tyres on my epitome of normal Passat.

I have a mate who bought an Italian supercar for £75k about 3 years ago. Its worth over £200k now. He was financed up to the eyeballs but its worked out well, he can now sell it, pay off his mortgage and have change left over to buy something newer outright.

what car was that? Unless he got the deal of he century i'm struggling to see how a car can go up 200% in 3 years.

£1000 for 4 tyres isn't out of the ordinary for 'normal' cars these days.

Say what? £600 quid for 4 P zeros for my boxter, i'm sure an ordinary car would be a fair wack less

Having said that I went to the BMW garage the other day and looked at the new M3, £65k for a nearly new model, I left soon after, how do people justify that to themselves?

But they don't think of it as £65k , they just think of it as £595 (or whatever monthly cost it is for a lease)
I can't imagine many people go in and just buy one off the bat do they ?

Heck if it's VED that's a worry, then think of my Austin Princess at nearly £300 a year, it costs more a year to tax it than I paid for it. 😀

I n r a t s but think about servicing costs, that is the reason these cars are cheap, and they may need a fair bit of work as soon as you buy them.

I speak from experience.

With the £ likely to keep dropping, maybe be a good idea to get something with the steering wheel on the wrong side? 😉

I think drug dealing is the usual method.

This.

I chat to prisoners every day.

My 993 Turbo went up in actual real realised value by 240% in just a shade under 3 years...
I'd like another but priced out now. 996 Turbo still a good investment.

alanf - Member
£1000 for 4 tyres isn't out of the ordinary for 'normal' cars these days.
A builder friend was paying north of £300 for one tyre for his Q7

I was gonna say re-mortagage your house if you have enough equity to do so.

If you don't, maybe it's not such a bright idea anyway?

On a tangent - reading this thread has made me feel much better about my cycle-related spending.

£1000 for 4 tyres isn't out of the ordinary for 'normal' cars these days.

My neighbour just said 4 run flats on his BMW X1 are £1000 !

All this talk about monetary cost, what about the environmental cost? Do none of you care?

All this talk about monetary cost, what about the environmental cost? Do none of you care?

It'll be petrol, so it will be cleaner thank a stinky 'orrible diesel.
It'll also be one less car that needs to be built at great cost to the environment.
Win, win!

My friends car is a Diablo...in white. It's flipping cool though.

4 tyres on my Q7 were £1200 and it'd do a set in 10K miles. The brakes on my rs4 were well north of £1500 for oem ones. The rebuild on my M6 is over 9k. Go in with your eyes open and research forums. I'd have never have bought the M6 if I had.

Properly fast cars are cool though. I dream of the day when mine is fixed and I can go back to Spa....the spar would be nice right now.

All this talk about monetary cost, what about the environmental cost? Do none of you care?

As already mentioned, the cost of reusing an existing car will be far more environmentally friendly than even cleanest new car.

But back to the original question, the finance of supercars is much harder nowadays as already said due to the reduction in appetite by lenders.

Generally I'd say (based on buying them in the past), if you cannot afford to buy the car twice then you can't afford it.

If you get the right one at the right time they can be wonderful, I have broken even on Exiges, 911's and 355's, and made money on Vantages. But you can't guarantee, and if it's your main car you will be putting miles on it so value will go down. As a second car you don't have to rely on an old exotic is great - but you will need to put aside 5k each year to keep it on the road (£1k service, £1.5k consumables, £1k insurance, £500 tax).

Hopefully you never need the slush fund so you will have spare cash and won't need to put it all aside each year, but if you don't put it aside you can bet you'll need it.

I dream of the day when mine is fixed and I can go back to Spa....the spar would be nice right now.

I've thought about this quite seriously, and I only lust after a slightly exotic car (Elise S1).

Buy one. You won't regret it. Bought mine in 2008, now worth more than I paid :).

The only problem with buying some exotics at the moment is that there have been huge increases in their value over the last few years and that makes them either very expensive or possibly at the top of their value for now, hence it's hard to see the gains of the recent years happening again for a while.

Haha! The Ved was just intended as an example of how model research can potentially save some money. But interesting to hear people's good and bad stories, keep email coming

Was chatting to one of the chaps round our way. Loads of silly cars round us.

He was saying the really nice stuff is going up in price and going abroad. Mainly India & China where they didn't have many 355s sold orginally but now loads of people want them for 'thier collection'

One of these fine modes of transport is mine 😉

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Although all 4 of my last 'fun' cars have gone up in value and have been very cheap to run

Pre March 2006 VED is £295 not £500

I didnt realise Audi RS5's were now considered "normal"

Do you think my Galaxy falls into this [i]exotic[/i] category ?

All this talk about monetary cost, what about the environmental cost? Do none of you care?

Odd to come on an exotic car thread to spout this handwringing nonsense.

I did 35,000 in my (diesel) car at 120g CO2. I did 3,500 miles at 254g CO2 in my Boxster. Which was worse for the environment?

I did more than 3,500 miles on my bike last year. Using the power of offsetting, I must be a fully fledged earthmuffin?

£1000 for 4 tyres isn't out of the ordinary for 'normal' cars these days.
A builder friend was paying north of £300 for one tyre for his Q7

That's not that outrageous really - a set of tyres for our old 330 wasn't far off this and those wheels were on 318 M Sports.

[quote=ScottChegg ]I did 35,000 in my (diesel) car at 120g CO2. I did 3,500 miles at 254g CO2 in my Boxster. Which was worse for the environment?

Building two cars so one can sit on your drive?

Neither was bought new. So they were already built when I came along. And I only drive them one at a time, so the impact isn't double, whatever your schoolboy maths might tell you.

And I have 4 bikes, should you only have one at a time? Or am I destroying the ozone layer with my insatiable lust for variety?

Don't do it, invest the money in your pension pot so your kids don't have to pay for your care.

Get a 911 996 for £12k, more real world usable. And it will still be worth that when you sell it.

stumpy01 - Member

and a TVR 'project' car that seems to have been a 'project' as long as I've known him (about 4.5 yrs).

Clever man- worst thing you can do with a project is finish it, then all you've got is a car.