PCP with BMW - Any way to get out?

Mimmy

Hi all,

My partner and I took out a PCP agreement with BMW for a new car 4 months ago - the car was around £34,000 but we pay £455 for 4 years (so only around £21,840 for the loan part), and we did it in my name.

We have since split up, and I think I will struggle slightly to pay for this and was wondering (hoping!) that there was a way to get out of this? I called BMW Financial Services and they said that I am liable for 50% of the debt, so around £17,000 before I could hand it back (would it not just be 50% of the £21,840?) They said my only option was to sell it, but that I'd likely take a big hit since it's so soon into the agreement (not sure what they meant by this), or try to part-exchange for something smaller, but again would likely take a hit.

Was a bit of a kick in the teeth to hear there was nothing I could do, so was hoping to get some advice from anyone with more knowledge than myself, just in case BMW were being biased in not wanting me to hand the car back?

Thanks in advance,
Mim

[Deleted User]

You'll need to pay 50% of the loan amount, plus the associated interest.

Mimmy

Hi zx81, does that mean 50% of the 34,000 or 50% of what I pay over the 4 years (21,840)?

burlington6

I wish financial planning etc was taught in school.

There will be thousands out there like yourself OP in similar situations who don't take on board what they sign up for.

Hope you sort it

nomoneytoday

It's half of the amount borrowed - cost of the car minus deposit.
The deferred balloon is included, as you borrow that too.

Oakdene

Its 50% of the amount borrowed which is showed on your contract

foxy-stoat

As you have only paid £1780 plus any deposit it seems crazy to pay a lump sum of £15220 just to get out of paying the £445 a month - unless you have £15K sitting in your savings account you wont be able to buy yourself out of this agreement. Unless you put down a big deposit the car would of depreciated by too much to be able to sell it for the full settlement value.

Now that you are signed up for this car, you may as well enjoy the £34,000 car and pay £445 a month and hand it back when you get to the half way mark - which on the figures you provided will be 3 years and 3 months - nearly the full term which is also crazy.

Good luck with it.

Brock_and_Roll

foxy-stoat wrote: »

As you have only paid £1780 plus any deposit it seems crazy to pay a lump sum of £15220 just to get out of paying the £445 a month - unless you have £15K sitting in your savings account you wont be able to buy yourself out of this agreement. Unless you put down a big deposit the car would of depreciated by too much to be able to sell it for the full settlement value.

Now that you are signed up for this car, you may as well enjoy the £34,000 car and pay £445 a month and hand it back when you get to the half way mark - which on the figures you provided will be 3 years and 3 months - nearly the full term which is also crazy.

Good luck with it.

I agree.....and need to get on Tindr to find a new (solvent) partner with a liking for new cars!

Nearlyold

Some misinformation posted in terms of the 50% figure. To clarify:-

You can do a voluntary termination once you have paid 50% of the total amount payable under the agreement.

The total amount payable is the total price of the goods, plus the total interest plus any fees.

Thus any deposit paid (either cash or a part exchange) counts towards the 50% payable.

Thrugelmir

Mimmy wrote: »

Was a bit of a kick in the teeth to hear there was nothing I could do, so was hoping to get some advice from anyone with more knowledge than myself, just in case BMW were being biased in not wanting me to hand the car back?

If were too easy everybody would be buying very expensive cars and handing them back when the novelty wears off. Cars depreciate from the minute they leave the forecourt.

pvt

The car depreciated significantly the moment you drove it away from the dealer. You are the one who is going to pay that depreciation - it's already gone. You bought a £34k car which is now worth about £25 to £27k, at best.

If you cannot afford to keep up the payments I would suggest your best option would be to sell the car and make up the shortfall. If you have no savings then I'm guessing you'll have to get a personal loan for about £7k-£8k to pay for this.