New car buying tips... / GAP Insurance

Kilty_2

cyclonebri1 wrote: »

Balance will be financed via a PCP deal inc £1000 deposit from my trade in - I've never had car finance before so what's the process? I assume I apply and have approval in principle but don't actually accept the credit agreement until the car's ready to go? (thinking about it this must be the case since the £1000 deposit doesn't exist until the dealer has "bought" my car)


That's what I meant, ;)

If I bought the car for cash it'd be cheaper than a nearly new one. Going any more than a year old means there's no 7 year warranty so it'd have 3-(age) years warranty left and could end up costing me money in repairs during the time I plan on keeping it

If I financed a used one it'd cost far more.

What's the problem ? :rotfl:

cyclonebri1

Kilty wrote: »

If I bought the car for cash it'd be cheaper than a nearly new one. Going any more than a year old means there's no 7 year warranty so it'd have 3-(age) years warranty left and could end up costing me money in repairs during the time I plan on keeping it

If I financed a used one it'd cost far more.

What's the problem ? :rotfl:

Sorry, no offence but I highlighted the finance bits to indicate that someone else, other than you, is taking the profit out of the arrangement. Guess I just have old fashioned, or even true MSE values, take care;)

I just don't see it any other way.:A It's my opinion and my way which adds to the spread of answers on here.

Kilty_2

Even if I paid the finance off in full which I won't be doing the total cost would be £6399.74 which is still less than some dealers want for a brand new Picanto (current Kia offer is £6670 OTR)

cyclonebri1

Kilty wrote: »

Even if I paid the finance off in full which I won't be doing the total cost would be £6399.74 which is still less than some dealers want for a brand new Picanto (current Kia offer is £6670 OTR)

Then I bow to you and am out of touch, enjoy

Kilty_2

cyclonebri1 wrote: »

Then I bow to you and am out of touch, enjoy

I appreciate that some people are adverse to finance but for some it's the only practical way to own a car and at this end of the market it's still ridiculously cheap motoring.

Rightly so in some cases - the dealer initially offered me their own Hire Purchase finance which is a lot worse value than the manufacturer PCP however of course it'll be far more profitable for them than it.

Flyboy152

lostinheaven wrote: »

With respect you're wrong.

VRI (aka Vehicle Replacement Insurance or Replacement GAP Insurance) covers - (in the case of VRI for a new vehicle) - the difference between your motor insurance payout and the equivalent cost of replacing the vehicle new-for-old at the time of loss, even if that replacement vehicle costs more than you bought the vehicle for first time around (subject to the claim limit of the policy).

Some motor insurance policies include new-for-old cover in the first 12 months and some (SAGA for one) include new-for-old cover for the first two years. (There are GAP Insurance providers who will allow you to defer the start date of their GAP Insurance policy to avoid duplicate cover during this period of new-for-old cover under your motor insurance (although the maximum deferment period I know of is 12 months))

However (certainly once any new-for-old cover - if you have it - expires) your motor insurance policy only covers you (in the event of a total loss) for the depreciated (depreciated from the original value when you bought it) market value of the original vehicle at the time of loss.

It's this that creates the "gap"... e.g. the market value of the original vehicle at the time of loss, is going to be lower than the original purchase price (Invoice GAP Insurance) or the current new-for-old replacement vehicle price (Replacement GAP Insurance)... this being the case, Replacement GAP Insurance is, with very few exceptions, almost always superior cover to that of an Invoice GAP Insurance policy.

It depends on what level of VRI one gets. If they get the most common type, the one that pays the difference between the settlement and the cost of replacing like for like, they are wasting their money. Most of the time GAP cover is sufficient to purchase a new car.