PCP vs HP for 'car upgrade'

jaydeeuk1

OddballJamie wrote: »

Just lease a Golf R, everyone else is.

By the time people get delivery though, it'll be a classic!

20vt-rs

Something to bear in mind also:


HP - Is a contract for a fixed term, you have to pay for the term e.g 36 months or pay hefty penalties to get out


PCP - Easier to get out of should the worse happen, once you have re-paid 50% of the depreciation or more you can just hand the car back .

root

InsideInsurance wrote: »

...when the value of secondhand cars crashes and the car is now worth less...

InsideInsurance wrote: »

...protects you from a total crash of the 2nd hand car market

You mention this crash a couple of times, i'm assuming this a metaphorical thing or are you saying this is likely given how popular PCP and leasing is becoming among people who would traditioanally outright purchase used? Not having a dig, just interested in your take on it.

InsideInsurance

root wrote: »

You mention this crash a couple of times, i'm assuming this a metaphorical thing or are you saying this is likely given how popular PCP and leasing is becoming among people who would traditioanally outright purchase used? Not having a dig, just interested in your take on it.

Not making any form of prediction but was doing work for an asset financing company at the time of the credit crunch and they got hammered when all the high value 4x4s started coming back in worth a massively less than they had predicted when they'd done the deal at the beginning of the finance