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  • FIRST POST
    • gord115
    • By gord115 15th May 17, 1:00 PM
    • 828Posts
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    gord115
    Paying off pcp early, will it be worth it.
    • #1
    • 15th May 17, 1:00 PM
    Paying off pcp early, will it be worth it. 15th May 17 at 1:00 PM
    I called in my local VW dealer today.
    They have an offer on used cars that if purchased with PCP,you can have 2 years warranty and two free services,2 year breakdown cover and 2 year MOT cover.

    I pointed out that I didn't want finance because I have the cash.

    He said if I took out PCP I could still have the extras and I could pay it off after a few months and save myself all the remaining interest.

    I forgot to ask about an early settlement fee,which even if it is a couple of hundred pounds would still be worth it.

    Does this sound right?

    Any help/advice appreciated.
Page 1
    • zx81
    • By zx81 15th May 17, 1:02 PM
    • 11,587 Posts
    • 11,584 Thanks
    zx81
    • #2
    • 15th May 17, 1:02 PM
    • #2
    • 15th May 17, 1:02 PM
    Yes - if you settle early, you will save on interest. The sooner you do it, the better - within the cooling off period, you will avoid the early settlement fee entirely.
    • fromtheshires
    • By fromtheshires 15th May 17, 1:08 PM
    • 200 Posts
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    fromtheshires
    • #3
    • 15th May 17, 1:08 PM
    • #3
    • 15th May 17, 1:08 PM
    Is it 0% interst on the PCP?

    I purchased a car very recently and wanted to go cash, but as the PCP was 0%, I decided to keep the money in my account and pay silly low amounts back for the time period of the PCP and then will just pay the rest in full when they want it.
    • pimento
    • By pimento 15th May 17, 2:07 PM
    • 5,119 Posts
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    pimento
    • #4
    • 15th May 17, 2:07 PM
    • #4
    • 15th May 17, 2:07 PM
    I cancelled mine within the 14 days they give you to change your mind and didn't have to pay a penny. Still got the discount offered for taking it out.
    "If you think it's expensive to hire a professional to do the job, wait until you hire an amateur." -- Red Adair
    • billn
    • By billn 15th May 17, 3:06 PM
    • 87 Posts
    • 33 Thanks
    billn
    • #5
    • 15th May 17, 3:06 PM
    • #5
    • 15th May 17, 3:06 PM
    I have done this twice now, take the pcp deal and then pay it off the next day, both times (with VW Finance) I kept the discount or servicing etc. The only reason the dealer tells you to pay the first few months payment is that they then get the kick back from the finance.

    Before I get flamed for sugesting this, the first time I did this I was told to do it by the dealer as they had missold the car i.e. they had offered something they should not have.
    If at first you don't succeed, sky diving is not for you!
    • gord115
    • By gord115 15th May 17, 3:44 PM
    • 828 Posts
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    gord115
    • #6
    • 15th May 17, 3:44 PM
    • #6
    • 15th May 17, 3:44 PM
    Yes - if you settle early, you will save on interest. The sooner you do it, the better - within the cooling off period, you will avoid the early settlement fee entirely.
    Originally posted by zx81
    If I do this will I still get the Free servicing etc?
    • zx81
    • By zx81 15th May 17, 3:53 PM
    • 11,587 Posts
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    zx81
    • #7
    • 15th May 17, 3:53 PM
    • #7
    • 15th May 17, 3:53 PM
    Yes, unless it is specified otherwise in the contract.
    • AnotherJoe
    • By AnotherJoe 15th May 17, 4:06 PM
    • 6,295 Posts
    • 6,663 Thanks
    AnotherJoe
    • #8
    • 15th May 17, 4:06 PM
    • #8
    • 15th May 17, 4:06 PM
    Yep, I've done this 2 or 3 times, first time, as with others here, the dealer advised me to do it.
    • AFK_Matrix
    • By AFK_Matrix 16th May 17, 5:53 PM
    • 647 Posts
    • 774 Thanks
    AFK_Matrix
    • #9
    • 16th May 17, 5:53 PM
    • #9
    • 16th May 17, 5:53 PM
    Can I just ask then as I now have 2 years remaining of my PCP and am wondering if I paid it off with a 0% superbalance transfer card would this work?

    And I assume the amount to pay off the PCP is 24x monthly payments? Or do I have to also include the baloon payment as well?

    Thanks
    • john1002
    • By john1002 17th May 17, 1:04 PM
    • 813 Posts
    • 346 Thanks
    john1002
    You have include the balloon payment as the finance company would include this in any settlement figure.

    John
    • Cornucopia
    • By Cornucopia 17th May 17, 1:21 PM
    • 8,571 Posts
    • 7,912 Thanks
    Cornucopia
    In addition...

    Can I just ask then as I now have 2 years remaining of my PCP and am wondering if I paid it off with a 0% superbalance transfer card would this work?
    Originally posted by AFK_Matrix
    Many finance companies do not accept credit card as a means of payment for large balances - so you'd need to look for a solution to this (current account transfer, for example). However, there may be fees associated with that which would offset any savings.

    And I assume the amount to pay off the PCP is 24x monthly payments? Or do I have to also include the baloon payment as well?
    You will need a settlement figure, which won't be 24x payments or 24x payments+balloon - unless your APR is 0%, in which case there's no point paying it off. The settlement figure will generally be the outstanding amount of all the payments less a rebate for interest saved.

    You also need to bear in mind that settling the PCP early almost certainly removes the option to hand back the car at the end of the term, which in some cases may be valuable.
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    • AFK_Matrix
    • By AFK_Matrix 18th May 17, 9:54 AM
    • 647 Posts
    • 774 Thanks
    AFK_Matrix
    Thanks for all the info guys. It won't be worth me paying off the PCP I have which is fine, just thought I might save some interest.

    And I would have used a Superbalance Transfer CC which basically allows me to transfer the money to my current account and then pay off the PCP. But I doubt I'd get anywhere near the limit required anyway.

    Thanks again.
    • motorguy
    • By motorguy 18th May 17, 3:28 PM
    • 14,841 Posts
    • 8,319 Thanks
    motorguy
    Is it 0% interst on the PCP?
    Originally posted by fromtheshires
    As its a used car and as per the VW promoted scheme at the moment, i'd be 99.0% certain its not 0%.

    From memory its quite a high APR - something like 10.9%
    Regards

    Paul
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