PCP - Clarify?

gzoom

matteh wrote: »

Thanks Motorguy,

I will 100% not keep it for the term. I've calculated i will probably do 21000 over my stated mileage in 3 years (4 year term). I suspect i will be able to VT or part chop it before the 3 year mark though. I was told it would be £25 more per month to increase it by 7k per year extra miles. I could afford that, but i'm not sure it's worth paying..

As others have said just make sure you work out the 50% termination point based on the whole loan/debt INCLUDING the final payment.

For example if your total loan amount is £10,000, and the final payment/ballon payment is £6000, you will NOT have reached the 50% termination point by the end of your PCP term, in which case you have to pay another £1000 to terminate early.

Some of the PCP deals are very odd these days. On my Nissan Leaf it's essentially like a Lease deal rather than PCP. The ballon payment is a massive £10K+ on a car with an effective 'cash' price of £13K, and zero deposit. Which means for me to terminate the contract early (50% value of the Loan) I have to pay Nissan £6K, given the low monthly repayment of £130/month (car not battery hire), in 2 years I only pay back £3120 of the £13K loan amount.....So it make no sense to try and buy the car at the end of the PCP deal...It's a totally mad situation....But it works out very cheap for me:rotfl: