PCP - am I missing something???

LincolnshireYokel

forgotmyname wrote: »

They give you a £10,000 car with a recommended retail of about £16,000

You pay £2000 up front and £200 a month for 36 months, Total £9200.

Then they get to sell the car on for £6000+

You have paid £9200 to rent a car for 3 years.

You dont owe them £5000 your only renting it. Unless you buy it at the end of course.

Doesnt suit everyone, I wouldnt want to spend nearly £10,000 and own nothing at the end.

Too right. You might as well get a loan from the bank for £14k for 4 or 5 years, and sell the car after 3 years and then pay the remaining loan off , at least you'll have an asset to do it with and enough deposit (about £3.5k) for the next one.

motorguy

LincolnshireYokel wrote: »

Too right. You might as well get a loan from the bank for £14k for 4 or 5 years, and sell the car after 3 years and then pay the remaining loan off , at least you'll have an asset to do it with and enough deposit (about £3.5k) for the next one.

What are you seeing as the difference between that and a three year PCP deal?

molerat

At the end you have to come up with a large payment to keep the car
or
Lose the car
or
Start another finance deal to buy another new car

See how it works now, you are kept in a permanant new car and finance cycle

jaydeeuk1

PCPs can work quite favourably on the right car.

My IQ was list price of £13500, had paint and leather seats thrown in the deal too. Gave in my old banger on the scrappage scheme, so effectively the deal should be £11500.

I pay £192 a month for 36 months. £100 deposit, so I've spent £7012 over the 3 years.

The car has a final value fee of £5800ish I can pay next month when it finishes. If I choose to pay off the fee, the total I've spent is about£12812... bloody good deal imo for a car costing £13500 list price and £11500 after scrappage, esp as getting a £11500 loan for 3 years would have worked out far more expensive

motorguy

molerat wrote: »

At the end you have to come up with a large payment to keep the car
or
Lose the car
or
Start another finance deal to buy another new car

But in the example LinconshireYokel was using of selling the car after three years, they've a lump sum to pay off anyway - THATS my point.

Also you dont have to 'come up with a large payment', you can simply take out a loan over a couple of years, thus equating roughly to LinconshireYokels 5 year loan example.

You dont 'lose the car' - you give it back. Thats your choice. Its agreed up front - its not a 'loss'.

And yes, whats wrong with getting a brand new car every three years if thats what you want? If you can afford it, why not?

molerat wrote: »

See how it works now, you are kept in a permanant new car and finance cycle

Of course i do - i've worked in or around the motor trade for 25 years now.

And no, you're NOT kept permanently in that cycle. No one forces you to get into another finance deal, you can do what you like - buy a cheapie, take out a loan for a used car, etc, etc.

And even if you're only partway through a PCP deal you have options. My wife opted out of a Subaru PCP deal simply by getting a settlement figure (£9,000) and selling the car back to a Subaru main dealer for £11,500.

motorguy

jaydeeuk1 wrote: »

PCPs can work quite favourably on the right car.

My IQ was list price of £13500, had paint and leather seats thrown in the deal too. Gave in my old banger on the scrappage scheme, so effectively the deal should be £11500.

I pay £192 a month for 36 months. £100 deposit, so I've spent £7012 over the 3 years.

The car has a final value fee of £5800ish I can pay next month when it finishes. If I choose to pay off the fee, the total I've spent is about£12812... bloody good deal imo for a car costing £13500 list price and £11500 after scrappage, esp as getting a £11500 loan for 3 years would have worked out far more expensive

+1

A good deal indeed.

PCP's arent for everyone, but by being open minded you can make them work for you.

verityboo

molerat wrote: »

At the end you have to come up with a large payment to keep the car
or
Lose the car
or
Start another finance deal to buy another new car

See how it works now, you are kept in a permanant new car and finance cycle

Complete rubbish

At the end of the agreement, as long as the car is worth more then the GFV you can trade it in anywhere, for any make of car - new or used. They pay off the GFV for you and the excess is the the deposit for the next car

gkerr4

forgotmyname wrote: »

Better still if it depreciates, Buy it after its done the bulk of its depreciation.

Whats a 2004 mondeo estate worth today with full mot and long tax? £1000 /£1500?

Well i paid just over £2000 for it in 2009 so the loss is neglible compared to a new cars depreciation.

I bet a lot of cars lose more than £2000 driving it out the showroom.

some people just like new, nice cars. each to their own. Id turn down a 2004 mondeo estate taxi. On a wet night. miles from home.

only messing**

each to their own i guess


(**this is true tho)