PCP - balloon payment or return to dealer?

mheuter

Hi, not sure whether this is the right place. I am trying to work out what to do with my PCP financed car at the end of the finance period. I have a 2012 VW Polo Diesel with now 65,000 miles, which I have had since October 15. I will have paid £1,000 down payment and 24 x £176 mostly payments, so total commitment at the end of the period will be £5,224. The ballon payment is £4,712, similar to buying a model on the open market with the same age/mileage etc. The original price would have been £8,500 at my local VW dealer.

Question I am trying to figure out - give the car back and buy or lease another one or buy it at the ballon cost??? My gut instinct is that I would have bought an expensive car (i.e. £5,224+£4,712, almost £10k ... Anyone can unscramble my brain on this?

thanks,

Martin

boliston

They normally want you to PCP another car as it makes them far far more money so if you are happy with the car and it runs well I would go with the final payment to own it.

custardy

mheuter wrote: »

Hi, not sure whether this is the right place. I am trying to work out what to do with my PCP financed car at the end of the finance period. I have a 2012 VW Polo Diesel with now 65,000 miles, which I have had since October 15. I will have paid £1,000 down payment and 24 x £176 mostly payments, so total commitment at the end of the period will be £5,224. The ballon payment is £4,712, similar to buying a model on the open market with the same age/mileage etc. The original price would have been £8,500 at my local VW dealer.

Question I am trying to figure out - give the car back and buy or lease another one or buy it at the ballon cost??? My gut instinct is that I would have bought an expensive car (i.e. £5,224+£4,712, almost £10k ... Anyone can unscramble my brain on this?

thanks,

Martin

if you had bought on straight finance it would have been more than the £8.5K window price.
So keep that in mind when comparing.

facade

mheuter wrote: »

The ballon payment is £4,712, similar to buying a model on the open market with the same age/mileage etc. The original price would have been £8,500 at my local VW dealer.

If you like it and it is running well, keep it.

Yes you will have paid £10k for a car worth £8.5k, but that is because of the finance package that you used.

Now you can keep the car for what it is worth today, or not.

Forget the money you have already put in, it is lost anyway.

boliston

Also better a car you know than the same car you dont know

LandyAndy

Have to agree with posters above. You have the chance to buy a second hand car that you know the history of, and are happy with, for a fair price. Your choice is simply whether to do that or buy a different car. All the money you have paid so far is a sunk cost and you should disregard it in your decision making.

System

If you want the cheapest option it is to keep the car you have. Start again on a new PCP and you're paying for the initial 3 years depreciation on a new car and the first three years are the ones that see the largest annual hits for depreciation.

LandyAndy

mheuter wrote: »

Hi, not sure whether this is the right place. I am trying to work out what to do with my PCP financed car at the end of the finance period. I have a 2012 VW Polo Diesel with now 65,000 miles, which I have had since October 15.

Tarambor wrote: »

If you want the cheapest option it is to keep the car you have. Start again on a new PCP and you're paying for the initial 3 years depreciation on a new car and the first three years are the ones that see the largest annual hits for depreciation.

The OP bought at 3 years old on a PCP.

Zola.

That's the thing about PCP I just dont like.

You have a nice car, you get used to the payments to an extent, then if you want to keep it your loyalties are tested with such a large amount, long after the novelty has worn off.