Car finance v PCH on IVA

clpblue1

I finish my IVA next month and need a new car urgently. We have been approved for car finance for £5k @ £180/month which is around 30% APR. I have also requested info about PCH to get a brand new car inc. maintenance and I await the costs, however the website shows it for £200/month all inclusive (ex petrol and insurance)
Does anyone have any knowledge of these two options and which would you say was best for us?
Cheers for any help you may have

UpToMyNeckInIt

clpblue1,

How urgent is your car need?

If you can hang on until your IVA drops off your credit file, you may find that you can then get a more sensible APR loan.

Given the options you provide, I would go the PCH route - for £20pcm more, you get to drive around in a brand new motor. You will then be able to look again at buying second-hand (or even buying 'your' car off the lease company), at much more competitive rates.

Well done on completing your IVA by the way.

Foxy-Stoat_3

How long is the term for the finance @ £180 a month?

FiatFan_2

Having looked about recently, pretty sure we'll be going the PCH route when we finish our IVA. However dealers aren't that happy when you mention this other than Peugeots just add fuel deal.

Over 5yrs till this will happen so could be better options by then

Foxy-Stoat_3

So your IVA finishes next month and you have already applied for finance and being approved....but you wont be buying a new car for over 5 years??

I think after your IVA you should use your current car and save up to buy another one......it would be better not to get back into debt as being debt free is a good place to be.

Good luck

FiatFan_2

Are you getting confused there Foxy-Stoat between the OP's post and mine? The OP has a month to go and has been approved for finance, I on the other hand have 5yrs till a clean credit file when we'll get new(er) cars. Current cars being 8 & 16yrs old.

I am looking to change my car within my iva and did recently look at PCH deals as I thought these would be allowable, but there still a form of finance my IP won't allow even though they are substantially cheaper to run and offer my creditors a better return.

clpblue1

Thanks for the comments guys. The IVA finishes on 20th October, but we need a car earlier than this
We have applied for a PCH via VW, but I'm not convinced we're going to be approved. I think we'll end up going down the finance route and re-financing in a couple of years
Thanks again