Hire purchase same as a PCP?

Dalglish

Hi

I am needing to buy a car for business use and have approached VW to buy a car on a finance agreement.
I want to finance a vehicle over 36 months and 15,000 miles per annum (45,000 total contract)
The VW salesman tried to convince me that the "VW Solutions" finance package is akin to a Personal COntract Purchase pack' I want the latter because I believe it suits my needs better.
I was not sure he knew what he was talking about so he introduced me to the VW finance manager - I asked him what product was VW Solutions based on, hire purchae, lease purchase, credit sale or PCP?
The finance guy was reluctant to expand and said that there was nothing in writing that he could supply me with which would explain which of these products it is.
I said that should I lose my job, God forbid, and need to dispose of the car at the 18 month point, a PCP allows you to hand the keys back and walk away from the fiance comitment.
At this stage, the finance guy got ruffled and declared the VW Solutions to be a hire purchase contract but which is the SAME as the PCP.
I disputed this - who is right? The finance manager or me?

Thanks for reading to the end ..

b0rk

Dalglish wrote: »

The VW salesman tried to convince me that the "VW Solutions" finance package is akin to a Personal COntract Purchase pack' I want the latter because I believe it suits my needs better.

VW New Solutions is a PCP. PCP's are a type of hire purchase.

I said that should I lose my job, God forbid, and need to dispose of the car at the 18 month point, a PCP allows you to hand the keys back and walk away from the fiance comitment.

Nope PCP is based on depreciation against a curve which hits the GMFV at the end of the term, prior to that it is possible to be above or below the curve.
If your payments put you above the curve then yes the finance company will allow to just hand the keys back, if you're below then you will have to pay the difference before you can return it, typically you will be below the curve until close to the end.
You can cover against unemployment via early termination insurance, either from VW finance or from third party insurers.

If you want genuine no commitment pay as you go motoring then you need to be looking a flexible Personal Contract Hire (PCH) agreement which will be more expensive. Under a PCH you're locked in for the fixed period, then you can either refix, go flexible or hand the car back. Obviously your payments alter each month to reflect the deprecation when lease is in a flexible period.

peterg1965

You dont have to take VW's finance PCP package. There are a range of companies out there https://www.freewaycars.co.uk and https://www.lexfreechoice.co.uk and many more, who will finance the car even if you buy it from your local dealer. You may even get a cheaper APR. Watch out for the Future value or final balloon payment, these vary wildly and also some are not 'guaranteed' values.

CLAPTON

why don't you simply take out a personal loan at the best rate you can find and get (independent) redundancy cover.
this means you are a cash buyer and are in a better position to negotiate a good price without being tied into the dealers financing.