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  • FIRST POST
    • random549
    • By random549 26th Sep 16, 4:18 PM
    • 538Posts
    • 279Thanks
    random549
    Audi Car Solutions Finance, Refinancing
    • #1
    • 26th Sep 16, 4:18 PM
    Audi Car Solutions Finance, Refinancing 26th Sep 16 at 4:18 PM
    Hi All,

    I took out a PCP loan with Audi to fund a car purchase in Dec 13 on a 4 year deal on a value of just under £20K @ 6.19%. I don't have to make the balloon payment until Dec 17, but given I could take out a loan at around 3.4% now and pay the settlement figure of £13.8K it makes a financial sense to me to proceed to re-finance.

    Am I missing something obvious?

    Thanks
Page 1
    • zx81
    • By zx81 26th Sep 16, 4:21 PM
    • 9,319 Posts
    • 9,138 Thanks
    zx81
    • #2
    • 26th Sep 16, 4:21 PM
    • #2
    • 26th Sep 16, 4:21 PM
    The sticking point is getting the loan - you would need a decent salary and very good history to get a further 14k at a low rate.

    28k is a lot of borrowing.
    • random549
    • By random549 26th Sep 16, 5:15 PM
    • 538 Posts
    • 279 Thanks
    random549
    • #3
    • 26th Sep 16, 5:15 PM
    • #3
    • 26th Sep 16, 5:15 PM
    I have a very good credit rating and a good salary so hopefully that shouldn't be an issue.
    • Gaz83
    • By Gaz83 26th Sep 16, 5:20 PM
    • 3,352 Posts
    • 6,327 Thanks
    Gaz83
    • #4
    • 26th Sep 16, 5:20 PM
    • #4
    • 26th Sep 16, 5:20 PM
    I have a very good credit rating and a good salary so hopefully that shouldn't be an issue.
    Originally posted by random549
    Your credit rating is irrelevant, lenders don't see it.

    What matters is your credit history, which shows that you've currently got an outstanding debt of £13.8k.

    Can't see any lender willing to lend to you at 3.3%.
    We’ve had to remove your signature. Please check the Forum Rules if you’re unsure why it’s been removed and, if still unsure, email forumteam@moneysavingexpert.com
    • foxy-stoat
    • By foxy-stoat 27th Sep 16, 10:01 AM
    • 1,169 Posts
    • 648 Thanks
    foxy-stoat
    • #5
    • 27th Sep 16, 10:01 AM
    • #5
    • 27th Sep 16, 10:01 AM
    but given I could take out a loan at around 3.4% now and pay the settlement figure of £13.8K it makes a financial sense to me to proceed to re-finance.

    Am I missing something obvious?
    Originally posted by random549
    Go and apply for a loan with the headline rate of 3.4% and see what you get offered, you probably need to put down the reason for the loan is to consolidate existing debt - doubt you will get offered the lowest rate to be honest but good lucks.
    • nomoneytoday
    • By nomoneytoday 30th Sep 16, 2:52 PM
    • 4,658 Posts
    • 2,803 Thanks
    nomoneytoday
    • #6
    • 30th Sep 16, 2:52 PM
    • #6
    • 30th Sep 16, 2:52 PM
    Don't forget that part of the PCP advantage is the balloon amount is guaranteed. If the car is worth less at the end of the debt, you can hand it back.
    If you pay off the PCP, then you'll have a separate loan, regardless of what you do with the car.


    In essence the PCP is the insurance on the future value.


    (all IMHO)
    • jonesMUFCforever
    • By jonesMUFCforever 2nd Oct 16, 1:46 PM
    • 23,178 Posts
    • 10,531 Thanks
    jonesMUFCforever
    • #7
    • 2nd Oct 16, 1:46 PM
    • #7
    • 2nd Oct 16, 1:46 PM
    Will they allow you to repay the loan now but not the balloon?
    What goes around - comes around
    give lots and you will always receive lots
    • chanz4
    • By chanz4 2nd Oct 16, 3:13 PM
    • 9,787 Posts
    • 2,837 Thanks
    chanz4
    • #8
    • 2nd Oct 16, 3:13 PM
    • #8
    • 2nd Oct 16, 3:13 PM
    Don't forget that part of the PCP advantage is the balloon amount is guaranteed. If the car is worth less at the end of the debt, you can hand it back.
    If you pay off the PCP, then you'll have a separate loan, regardless of what you do with the car.


    In essence the PCP is the insurance on the future value.


    (all IMHO)
    Originally posted by nomoneytoday

    You would of thought, but infact its not. Google financial ombudsman decisions and look up vw. And yes you can get a loan at the less rate just like I did. You can also put it down as car purchase as pcp is only hire until you pay the balloon
    Don't put your trust into an Experian score - it is not a number any bank will ever use & it is generally a waste of money to purchase it. They are also selling you insurance you dont need.
    • chanz4
    • By chanz4 2nd Oct 16, 3:14 PM
    • 9,787 Posts
    • 2,837 Thanks
    chanz4
    • #9
    • 2nd Oct 16, 3:14 PM
    • #9
    • 2nd Oct 16, 3:14 PM
    Will they allow you to repay the loan now but not the balloon?
    Originally posted by jonesMUFCforever

    It will bring the balloon forward, its a way they do you over
    Don't put your trust into an Experian score - it is not a number any bank will ever use & it is generally a waste of money to purchase it. They are also selling you insurance you dont need.
    • Penelopa.Pitstop
    • By Penelopa.Pitstop 4th Oct 16, 11:00 AM
    • 218 Posts
    • 101 Thanks
    Penelopa.Pitstop
    The amount mentioned in first post is settlement figure, so it's payin off rest of payments and final baloon payment.

    If you want to keep the car for a couple more years, it's worth doing it.

    • JJG
    • By JJG 9th Oct 16, 6:43 PM
    • 197 Posts
    • 229 Thanks
    JJG
    Go and apply for a loan with the headline rate of 3.4% and see what you get offered, you probably need to put down the reason for the loan is to consolidate existing debt - doubt you will get offered the lowest rate to be honest but good lucks.
    Originally posted by foxy-stoat
    It does depend entirely on the OPs income and credit history. I recently got a 19k loan at 3.4% to repay a loan at 5.9%. And consolidate existing debt was the reason.
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