Car on PCP

debtfreeme2015

Hi all. I'm hoping someone can offer some advice. I got a car on a PCP plan in march and have quite high repayments (I can pay them but they are high for a car) and when I got the car was told I was able to make overpayments to lower the monthly amounts. I would like to do this and can afford too. however after reading threads on here am wondering if it is worth doing. Hope somebody will be able to advise. Thanks all in advance

rs65

You want to pay more so that you can pay less? Eh?

DUTR

Do you mean pay a lump sum upfront? Maybe worth adding the difference and clearing the balance and balloon payment if you are in a position to do so.

InsideInsurance

In theory you will pay less interest if you do it but if thats really worth it depends on your APR

OddballJamie

Depending on how the finance is setup, making an over payment can either lower the monthly payments or in most cases it will shorten the term but keep the payments the same.

What interest rate is the car finance at?

debtfreeme2015

OddballJamie wrote: »

Depending on how the finance is setup, making an over payment can either lower the monthly payments or in most cases it will shorten the term but keep the payments the same.

What interest rate is the car finance at?

Will need to find the paperwork to check the apr but was told I cant shorten the term just reduce the monthly payments. I just wonder if this is worth doing or if i'm better saving the money

InsideInsurance

debtfreeme2015 wrote: »

I just wonder if this is worth doing or if i'm better saving the money

As per previous post - compare loan APR -v- savings net AER

If loan is higher, repay. If savings is higher, save.

debtfreeme2015

The apr is 7.31% which is obviously more then I get for any savings.
Does anyone know how it would affect me in 2 and a bit years time though when I change the car?

OddballJamie

It wouldn't affect anything when you change cars.

Going by your username and signature, would it not be in your interests to stop using finance for cars and just buy an older one outright.

debtfreeme2015

Thanks all my debts are paid off and the car is all that I have outstanding. which is why I am planning on starting to pay extra off of it