Mini Finance

Lost_Prophet

Hi,

It was suggested that I post this in here as people may be able to relate after originally posting it in the Loans section

To all those mini owners out there...

I called in today to look at a PX for my 2007 plate new shape Mondeo (its done 20000 miles). The settlement figure of my Mondeo is say around £7000 with £8000 left to pay if I keep it for another 2 1/2 years. The initial agreement was for £13000 but I would be ending it early

The Mini dealer offered to cancel it out so I start a fresh. I work it out that if I keep it, due to predicted valuation depreciation the car would be worth £4000 in 2 1/2 years time. Therefore, it will lose £3000 if I keep it for 2 1/2 years

With a brand new Mini I have been offered very similar repayments over 4 years with an balance remaining of £6000 at the end of the four years. I can then choose to pay this off and own the Mini, hand the keys back and have nothing or take up the Guaranteed Future Value which I believe is also £6000 (over 4 years I would of paid ~£11000)

My questions... is it really worth it to get the Mini and then have £6000 left to pay at the end of the agreement (after four years)?
If I part exchange it I would end up with only about £3000-4000 left over with this dealer so will only have £3k to show for my ~£11k spent.
Also, do you think it is worth it given that I stand to lose £3000 for when I PX my car in 2 1/2 years time and that this Mini will be brand new

Thanks in advance

plane_boy2000

This dosent make sence. How can the settlement figure for your existing car by 7K but be 8K in two and a half years - it must go down, not up

I think you are missing how this works. The MINI is on a PCP scheme - they are saying that it should be worth about 6K in 4 years. At this point you can either pay them 6K to keep it or hand it back. You should assume that the part ex value will be 6K so you will have no equity in the car. I dont understand why you think that the GFV will be 6K but you will be able to part ex it and get 3K back.

motorguy

plane_boy2000 wrote: »

This dosent make sence. How can the settlement figure for your existing car by 7K but be 8K in two and a half years - it must go down, not up

They didnt say that . If the o/p settles now they will get a discount on the interest payable, whereas if they continue to make the payments for another two and a half years until the car is paid off, they will total £8000.

plane_boy2000 wrote: »

I think you are missing how this works. The MINI is on a PCP scheme - they are saying that it should be worth about 6K in 4 years. At this point you can either pay them 6K to keep it or hand it back. You should assume that the part ex value will be 6K so you will have no equity in the car. I dont understand why you think that the GFV will be 6K but you will be able to part ex it and get 3K back.

Because the PCP deal is set at the lowest amount for the car, with the assumption that the car will be worth more than that come trade in time, thus you have some equity for your next car - but theres no way its going to be £3000, maybe £500.