PCP - 3 or 4 years?

Ultrasonic

I realise I totally ignored the impact of the deposit above, which is actually rather important.

For the 3 year PCP deal (assuming £150 monthly payments) the total cost over three years is £9400. This is an average of £3133 per year.

For the 4 year PCP deal (assuming £140 monthly payments) the total cost over four years is £10,720. This is an average of £2680 per year.

That's a difference of £453 per year rather than the £120 per year I used above. On that basis I'd probably lean more towards the 4 year deal...

(I thought it was too easy to conclude the 3 year deal was best above!)

geek1981

But the car's real value after 3 years is definitely more than £1320 than 4 years which makes 3 years better, doesn't it?

tomtom999

Have you tried to get a quote direct from audi dealership as most of the time you may find them cheaper. Also when you order from agents, you will not receive the same after sales service should you have bought from your local dealership. Avoid paying any administration and document fees to the agents and check also their terms if you were to cancel the order.

geek1981

local dealership can never get anywhere near drivethedeal (£1500 cheaper). Warranty comes directly from Audi and there is no cash transactions involved with broker as dealer pays them commission. Also finance is from Audi directly too.

tomtom999

When I wrote dealership, do look for one like WLMG for Nissan Cars but check similar for audi cars. I am a fan of Nissan cars so don't know much on audi cars dealerships

tomtom999

What I noted with PCP it is good for some Nissan cars and Audi cars as they hold their values even after 3 years.

Ultrasonic

geek1981 wrote: »

But the car's real value after 3 years is definitely more than £1320 than 4 years which makes 3 years better, doesn't it?

The GFV is the amount you have to pay at the end of 3 or 4 years if you want to buy the car. So this is only relevant if you intend to keep the car (which you said you didn't), or if Audi have badly underestimated the final value such that you can make a profit by buying it at the GFV and then selling it yourself. I suspect Audi have a fair idea what the car will likely be worth in 3 or 4 years though?

geek1981

Most PCP these days have GFV well below a realistic value.It is not very wise to hand the car back and walk away if you are on PCP these days. (unless you have a car which depreciates that much) May be this is the finance company's strategy to tie up customer on a new contract using the balance as a deposit towards next car.

Ultrasonic

geek1981 wrote: »

May be this is the finance company's strategy to tie up customer on a new contract using the balance as a deposit towards next car.

Surely if the idea was to encourage people to buy a new car rather than the one they have been driving for the last three or four years then finance companies would set artificially high GFVs? Setting it low would seem to make it more likely people would choose to keep their existing cars...

geek1981

Hmm.. personal choice. I won't pay 8.5k from my savings to buy my 3 year old qashqai when i finish my contract. I would rather trade it in with a dealer and get another brand new car keeping the same or lower monthly payments.