Car scrappage scheme
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It sounded like a great incentive when it was launched back in May, and so many people have taken advantage of the cash for bangers scheme that experts had predicted the budget would run out by the end of August. As yet the scheme is still available but does that mean we should rush out and buy a new car before it's too late or is the scheme not really worthwhile after all?
The first thing to remember is that a new car starts to depreciate the second you drive it out of the dealership. In the first year, a new car can depreciate around £500 a month. Make sure you check your chosen car's rate of depreciation with a used car guide such as theaa.com, glass.co.uk or parkers.co.uk. Next, bear in mind that a new car will have higher insurance premiums than your current old banger. And you might have to pay a fee for cancelling your old insurance or swapping to a different model.
The scheme is only available to people who have owned a car over 10 years old for more than 12 months, and that also has an MOT. When you take it to the dealership and choose your new car, the dealer will take £1000 off the price and the government fund will cover the next £1000. It's up to you to haggle with the dealer to bring the price even lower. However, with the car industry in its current state, you probably have a good chance of knocking more off the price as dealers are keen to get cars off their forecourts.
So if you were considering buying a new car anyway and would like to take advantage of the £2000 incentive, the fund of £300 million hasn't run out yet, so check out your local dealer now. Will you be swapping your old banger for cash or do you think the scheme is clapped out? Leave a comment and share your thoughts.
