PCP or buying 2/3 yr old car

crvs

Guys,

Does pcp or buying 2/3 year old is beneficial? We are hit with dielamma . Please help?

Thanks,
Vidhya

motorguy

crvs wrote: »

Guys,

Does pcp or buying 2/3 year old is beneficial? We are hit with dielamma . Please help?

Thanks,
Vidhya

PCP brings you into a cycle of never owning the car, but payments may be lower and you get a new car.

Buying outright means you own it and arent forced to do anything once the last payment is made.

Up to you really. Theres merits for each

crvs

Paul,

We are looking for new home and considering mortgage. Which of the above two is best for us?

Vidhya

pimento

My sister paid off her PCP when she applied for a mortgage earlier this year. Not sure it would have made a difference but it's always better to have little or no other borrowing when applying for a mortgage.

saverbuyer

Really depends on a number of things. How big is the deposit? How tight is affordability etc. Car payments will reduce the amount you can borrow for the mortgage but lower deposit will affect your LTV and the rate you borrow at.

I'll be looking at houses in the future and decided just to buy two new cars outright as the difference wouldn't affect my LTV by much.

Got a good deal on price as I negotiated based on taking PCP out and paid both cars off within 14 days with little penalty.

Dealers seemed to offer deals on PCP but not as much paying cash.

Foxy-Stoat_3

crvs wrote: »

Paul,

We are looking for new home and considering mortgage. Which of the above two is best for us?

Vidhya

https://forums.moneysavingexpert.com/discussion/5051194

Buy a cheaper car outright will be best and use the cash for the deposit for your new mortgage.

bluesnake

2-3 year old car, you avoid often a huge depreciation of the first 2-3 years and the car is yours. If you keep the car for 10 years, then you will probably find that you saved a bit compared to 3 PCP cars

On PCP you pay and after 2-4 years, nothing is yours. The car has to be returned more or less pristine

Hintza

My understanding is that these days they are anal about checking your ability to pay the mortgage and I bet they will also factor in potential interest rate rises too. So the less outgoings you have will make getting a mortgage a lot easier.

So if I were you I would be concentrating on the deposit and the mortgage at this stage. The newer car can come later.

Herzlos

If you already have a car then I'd wait until the mortgage is sorted and then look at what you can afford. I've always gone for larger older cars (~6-12 year old saloons) but that might not be the best option for you

jimjames

Herzlos wrote: »

If you already have a car then I'd wait until the mortgage is sorted and then look at what you can afford. I've always gone for larger older cars (~6-12 year old saloons) but that might not be the best option for you

I agree.

If you are saving for a house then putting all your available money into that would seem to make more sense than spending on a car if you already have one you can use.