Pay Off PCP Within 14 Days

harrpau7

Quick question (apologies if covered before), it seems that buying a car on PCP gets you more discount than buying the same car outright, so if I had the money to buy a car outright, would I be able to go to a showroom, get a PCP deal so that I get discounts etc that usually come with it and then pay off within 14 days?

I ask as I overheard someone the other day saying they did just that, the car they wanted was £11K outright, they got a PCP deal and settled within 14 days and as a result paid just over 9K total instead as the PCP deal offers still stood. If this is the case it may be something I explore in the future.

Thanks

neilmcl

You can pay off (settle) a PCP finance agreement any time you want. 14 days is simply the time allowed, as a legal right, to cancel the agreement without penalty.

If you can get a decent discount/contribution for a PCP and can afford to pay it off straight away then by all means you should do that.

marlot

harrpau7 wrote: »

Quick question (apologies if covered before), it seems that buying a car on PCP gets you more discount than buying the same car outright, so if I had the money to buy a car outright, would I be able to go to a showroom, get a PCP deal so that I get discounts etc that usually come with it and then pay off within 14 days?

I ask as I overheard someone the other day saying they did just that, the car they wanted was £11K outright, they got a PCP deal and settled within 14 days and as a result paid just over 9K total instead as the PCP deal offers still stood. If this is the case it may be something I explore in the future.

Thanks

Yes, I've done this twice. The most recent being last June.

On the most recent one, I had to pay a small amount of daily interest on the money - but it was MUCH less than the additional discount I was given. I paid over the phone using my debit card.

billn

I have also done this with VW Finance and yes it worked with them, there is some confusion (to me anyway) about what you should say to the finance company be it "settle" or "withdraw".

If you search for past threads on this you will get varried opinions as to whether you should do this or not but from my experience it has worked (twice) and I still got the discount on one and free servicing on the other.:)

Oakdene

Of course you can, you call up the finance provider & ask for a settlement figure & you then ask if you can pay this balance either by card or BACs...

Rain_Shadow

Beware of being told, as one of my work colleagues was, that you cannot settle the finance in the first three months. AFAIK this is just the period during which the salesman will get his commission clawed back.;)

neilmcl

Rain_Shadow wrote: »

Beware of being told, as one of my work colleagues was, that you cannot settle the finance in the first three months. AFAIK this is just the period during which the salesman will get his commission clawed back.;)

The salesman will likely get commission if the car finance settled, he may not if the finance agreement is cancelled. Besides, it's not usually the sales guy that gets the "commission", it'll be the finance guy who arranges the agreement.

I've even had a sales and finance chap tell me that they had no issue (even though they weren't allowed to mention it) with me withdrawing from the agreement straight away in order to get a discount. At the end of the day all they were interested in was shifting a new car.

neilmcl

billn wrote: »

I have also done this with VW Finance and yes it worked with them, there is some confusion (to me anyway) about what you should say to the finance company be it "settle" or "withdraw".

It's pretty straight forward. Within 14 days you have a legal right under the Consumer Credit Act to cancel/withdraw from most types of finance agreements, without penalty. There is a very slight chance that you could be chased for the contributions/discounts you received, but this is extremely rare and would only work if it was a term in your original agreement stating that any contributions were on condition of you completing the agreed term. Personally I've never seen this in any PCP/HP agreement's T&Cs.

Settling the agreement is entirely different and as I said you can do this any time, the longer you leave it the more interest you'll have to pay, however if you settle quickly the interest amounts will be minimal.

marlot

neilmcl wrote: »

...
I've even had a sales and finance chap tell me that they had no issue (even though they weren't allowed to mention it) with me withdrawing from the agreement straight away in order to get a discount. At the end of the day all they were interested in was shifting a new car.

The salesman I bought from was fully aware that I'd be cancelling the PCP. He asked me not to discuss it with him - I assume so he had some level of plausable deniability!

Rain_Shadow

Just telling you what was said.

YorkshireTraveller

I have done this twice with VW finance. Took the finance to get the three years free servicing and a better deal overall.

Settled in full after after three months - was advised to make three payments so as not to lose the free servicing (or perhaps to maintain the salesman's commission!)

Was happy to do this as the deal was very beneficial to me.