Fancy a change, advice on hire purchase req'd

continualdiamond

I just handed my 1st car back on HP, I'd had it 2 years, half the agreement. Only handed it back as started to not trust it anymore. Got another car on HP, only thing counted against me was 1 year knocked off the term i could have, so only have a 3 year term.

The car i handed back to me at least i did it at the right time because it was still in reasonable condition enabling me to hand it back and have the liability cost at £0.

The car i have now has a warranty for 3 years and gap, which i didn't have on the other which was pretty stupid. So i am more relaxed knowing this year car is covered for the term of my HP so no need to hand it back.

Like mentioned i have done it once, learn't from it and made corrections with the car i have now so i don't need to do it again.

AdrianHi

I agree with the above, best not to make a habit of terminating HP or PCP agreements early. No problem with trading on and extending an existing PCP on a different car though. If dealers get to know you do this you'll probably find them ringing you up offering you other cars for only £20 a month more or whatever.

The person I know who changes the car every 9 to 12 months on PCP also shops around far and wide on BMW AUC and will travel for the right deal. This way he tracks down those dealers looking for one last sale in the month to get their bonus and gets 10%-15% knocked of advertised price.
He stopped this pattern before the used car market went bad (it was obvious that it was going to happen) and stayed in a cheap car for a while. He would have lost 1000's otherwise. So you need to watch what your doing if you go this route.

Pete.g

Hi, Just an update.

After visiting a few dealers over the last couple of days It's become quite clear I'm not going to get the car I want within my budget from a dealer. So I plan to have a look round a few car supermarkets over the next few days and see what they can come up with.

AdrianHi

You can still cut a deal with a BMW AUC (Approved Used Car).
http://www.bmw.co.uk/bmwuk/auc/advanced_search/0,,___,00.html?empty=1
Last week of the month when someone will be looking to hit a target, burn up the phone ringing around with offers on cars 10%-15% below asking price as far a field as your preapred to travel. It might take some time but a result can be had. Sytner group seem more willing to cut a deal than most, which is ironic in a way as they are owned by BMW UK now.
If your buying a car still under manufacturers warranty not so much of a concern though.

shona_2

AdrianHi wrote: »

No figures handy for a 1 year loss on a 55 plate, but 57 plate to 56 plate is about £1900. 58 plate to 57 plate is £2600. £700 more.

Hi Adrian
where do you find figures like this? Do you have a Glass guide? I find the Parkers one a bit optimistic, but I really want to do the figs to help me decide between buying 1 yr old, 3 yr old or 5 yr old!!

thanks
Shona

AdrianHi

shona wrote: »

Hi Adrian
where do you find figures like this? Do you have a Glass guide? I find the Parkers one a bit optimistic, but I really want to do the figs to help me decide between buying 1 yr old, 3 yr old or 5 yr old!!

thanks
Shona

Agree, parkers optimistic for absolute price, but I still see it as a usefull guide to depreciation over time. I'm looking at the difference between trade in prices one year to the next, this doesn't account for the difference between purchase and trade in price. You get that down by putting the effort into hunting down that 10-15% discount (yes it's going to take work) and possibly selling privately later on.

shona_2

I wondered if you could get a Glasses guide on ebay, but seem few/far between.
But you can get some free Glasses valuations via the Vauxhall site so might build up a picture that way.
My first prob is I can't decide what car, and have ruined myself at the prestige (but older) end of things by running an Audi A4 and a Merc SLK, and now have expensive tastes! Thinking about a BMW 3 touring (but few with leather) or a Honda CRV exec... quite, quite different animals, I know! And I wouldn't want to pay full whack for either...
But need to get a xls going with prices to justify the right age to myself!

mark5

http://www.vauxhall.co.uk/vaux/pages/financeAndServices/valueYourCar/index.jsp

click on value your car

shona_2

AdrianHi wrote: »

This is why I'm saying buy something around a year old and run it for a short enough time to keep it at average mileage, certainly under 60,000 miles because that's when it's value drops in the eyes of the BMW dealer because that's when they cannot sell it as BMW AUC anymore and the BMW extended warranty price goes up.

I'm beginning to think that way too.

Thinking about a CRV (diesel ex), and trying to do the sums, I reckon, including depreciation (just added on drop in trade in value (ave con from Glass) from purchase costs), total running costs (based on guesswork for MOT, service costs, not fuel, tyres) are as follows:
on a brand new one - £9400
1 yr old - £6540
3 yrs old - £7830
5 yrs old - £ 7550

ie buying one at 1 yr old means over next 3 years, very little MOt costs, and the massive hit of the 1st yrs depreciation is out the way. Plus you get to drive a nearly new car, which is nice, lets face it.

Thoughts anyone, whether this seems kinda sensible, or just daft?

AdrianHi

shona wrote: »

I'm beginning to think that way too.

Thinking about a CRV (diesel ex), and trying to do the sums, I reckon, including depreciation (just added on drop in trade in value (ave con from Glass) from purchase costs), total running costs (based on guesswork for MOT, service costs, not fuel, tyres) are as follows:
on a brand new one - £9400
1 yr old - £6540
3 yrs old - £7830
5 yrs old - £ 7550

ie buying one at 1 yr old means over next 3 years, very little MOt costs, and the massive hit of the 1st yrs depreciation is out the way. Plus you get to drive a nearly new car, which is nice, lets face it.

Thoughts anyone, whether this seems kinda sensible, or just daft?

Counter intuitive yes, daft no. I've done similar sums many times on different cars. As you've demonstrated older car does mean cheaper IF you are lucky and don't get big repair bills, but it's not cheaper by much compared to young (but *usually* not brand new).
Exception to this rule is people doing very low mileages where they will loose too much to depreciation because of time and not use of the car.
The downside to the young car is your tieing up more cash in it and/or you have the cash flow challenge of meeting it's purchase price - whether you do that by leasing it, loan or paying cash. There is a risk attached to this.

Another example, what's the difference between a '51 plate Skoda Fabia 1.4 Classic and a brand new Fabia 1.2 Classic (same performance)?
Answer: break it down as a long term monthly expense and it's about £30 a month more for the new car assuming 12,000 annual mileage.