VW Solutions Finance

ChileanRed

I'm in the same boat! Do I just buy outright, or will I really save anything by going via VW "solutions" route.
They say they will give £500 towards the deposit and 3 year servicing will cost me £99 instead of £299... (total "saving" of £700).
I can pay just three months payments and then settle the account .. and as the interest is spread across the full term (36months) rather than being "front end loaded", I would get a rebate on the interest ???
I just can't get my head round it ...confused.com! :0/

Trebor16

Retired_Prof wrote: »

I have exactly the same query as Simon - i.e. I was advised to take a VW Solutions finance plan rather than pay in full for a new VW Polo in order to receive a £500 contribution from VW and free servicing for 3 years. Like him, I was told that if I paid off the loan within a few weeks I would not incur any penalty. This seems too good to be true! I would like to ask Simon whether he followed this advice and, if so, how he got on, and to ask Trebor whether his experience was with the "Solutions" plan or with a straight HP plan?

Any advice gratefully received!

Jenny

Hello Jenny,

Mine was the HP. Am I right in thinking that the solutions is the scheme where you pay a lower monthly payment and then have the option of a balloon payment at the end of the agreement?

Trebor16

ChileanRed wrote: »

I'm in the same boat! Do I just buy outright, or will I really save anything by going via VW "solutions" route.
They say they will give £500 towards the deposit and 3 year servicing will cost me £99 instead of £299... (total "saving" of £700).
I can pay just three months payments and then settle the account .. and as the interest is spread across the full term (36months) rather than being "front end loaded", I would get a rebate on the interest ???
I just can't get my head round it ...confused.com! :0/

Yes, that's how it works. You don't even have to wait three months before settling up and you still retain the benefits. They are fully aware that people will do that but because the law was changed on the settling of loans ahead of time there is little they can do to stop people signing up to these agreements and paying them up early.

In fact, it was the finance manager at the dealer who suggested it!

But the best way to do it is to pay off the majority of the loan, leaving say a few hundred quid on it and then asking for a settlement figure on the few hundred quid. It lessens the amount of penalty interest they can charge doing it that way.

ChileanRed

Thanks Trebor.
I have already paid £1k deposit and my new car is on order, but I can decide which payment route to go down when the car is ready. I think the max I can put as deposit on the finance/solutions option is 30% of the outstanding balance. I can actually (very fortunately after years of saving) afford to buy outright, but if there is a chance of saving a few quid then I'll gladly take it .........better in my pocket than theirs!! :0)

Retired_Prof

Trebor16 wrote: »

Hello Jenny,

Mine was the HP. Am I right in thinking that the solutions is the scheme where you pay a lower monthly payment and then have the option of a balloon payment at the end of the agreement?

Yes, "Solutions" has the balloon payment at the end of the agreement. I shall do as you suggest -- pay off the bulk almost immediately and the remainder after a couple of months.

Very many thanks for your helpful advice.

Jenny

Eciton

Trebor16 wrote: »

I bought a VW in January this year and the dealer advised me to borrow £5000 with VW Finance to get a free servicing deal. The dealer told me that I could pay the money back with little penalty and this was confirmed with VW Finance.

Before the first payment was due I made a lump sum payment of £4500. They then took my first payment and I then called and asked for a settlement figure which I then paid. The loan cost me £5017 so I have got two years servicing for £17.

Don't pay off the loan in one go as they can hit you with the rule of 78. But if you pay off the bulk of the loan and then pay off the final amount then the rule of 78 is based on the outstanding balance at the time of the settlement request. In other words, the amount of penalty interest will be much lower on a balance of £500 than it would if you asked for a settlement on the whole loan amount.

Hi Trebor

I'm just about to sign up to the same agreement as yourself. You stated that you paid a large lump sum before your 1st monthly repayment. Could I ask you how you actually went about this? Did you pay directly into the VW account with a reference to your credit agreement?

Thank you!

Trebor16

Eciton wrote: »

Hi Trebor

I'm just about to sign up to the same agreement as yourself. You stated that you paid a large lump sum before your 1st monthly repayment. Could I ask you how you actually went about this? Did you pay directly into the VW account with a reference to your credit agreement?

Thank you!

Hello Eciton,

I contacted VW Finance and they gave me the sort code and account number of their account to enable me to make a payment. I then set up a payment with my online banking and used the loan reference in the appropriate place and then made a payment.

HTH

Eciton

That's great! Sounds like a plan.

triniscope

Following trebor 16's advice , i repaid capital this week before my first repayment and it was even easier as they took payment by debit card. 20 minute wait to speak to adviser though. Also asked if i wanted to reduce the term or reduce the monthly repayments. Selected the former. Worked out i now only have one monthly repayment before final balloon repayment so doesnt seem much point in phoning again to get a final settlement figure any sooner. Great advice trebor16 and thanks Mr VW for the 1500 quid.

mandm65

It sounds like a deal one must avail, would it be fair to assume that you could apply this principle (get finance to avail the benefits and then pay early) any car manufacturer offering finance deal?
Cheers