Car Lease

LitttleKitten1978

Hi,
Last year I signed up for a car PCP plan lease of 4 years. They worked out my annual mileage to be around 20,000 miles so I signed up for that.
Anyway this year I would have had the car a year and have only done 6,500 miles!

I am told they can't reduce my annual mileage as that is what I have signed up for so I am stuck really.
Has anyone else ever been in this situation,
I hate the thought I am paying more for it than I should be.

What are my options, I have 3 years left on the agreement.

gilbert_and_sullivan

Well, if you're paying more than you ought to be that should in theory make the final balloon payment less, so it might be worth buying the car at the end and either keeping it or selling it on whichever you prefer.

loskie

didn't you know your own annual mileage?
Seems very odd are you sure the 20000m isn't for the whole 4yr term not annual? That would make more sense.

Crabman

What annual mileage have you stated to your insurer?

If you've asked them to insure you for 20,000 miles you might get something back from them.

Cornucopia

It's not the end of the World.

There are 4 options at the end of a PCP, and the mileage agreed in the contract is only relevant in one of them....

1. Walk away - this is where the contract mileage comes in.

2. Trade in the car - you'll get back whatever the difference is between the actual value of the car and the balloon payment.

3. Buy the car by paying the balloon payment.

4. Sell the car privately - this can be tricky, but will give the maximum return.

thescouselander

This shouldn't be a problem. You're paying more than you should be at the moment but the car, in theory, will be worth more than originally estimated when you get to the end of the deal.

With any luck this means you'll have built up some equity in the car which you'll be able to recoup when trading on on the next deal. Alternatively, if you don't do that, the car will be worth more than the balloon payment and you could then make the payment and keep the car of sell it on thereby releasing the equity.

LitttleKitten1978

No, I worked out my annual mileage before I leased the car and it worked out to be 20,000 so that is what I put down.
Only now my annual mileage has drastically come down and I will have only done 6,500

LitttleKitten1978

Thanks, I'm glad it is not the end of the world