VW PCP finance

Sara_Jussab

Hi,
I am 21 years old and I have a VW polo 1.0 petrol se on finance (65 plate) 2015 model so ive had it on finance for two years on PCP. I pay around £174.07 a month , so far ive paid £4176 for two years and i recently got a letter from of a settlement figure of around £9000 approx , and my agreement is for 4 years but I want to part exchange with a new model but im confused what to do and when to part exchange, like wait another year. I dont quite understand how I save money and when i recently went to the showroom to enquire about the new polo beats version they told me for £500 deposit towards it and £210 a month which i found was expensive as my current mileage for my car is only £5000 for the past two years, so surely they shud be already taking the deposit from what my balance is , but i dont know how it works? Anyone can help me how it works, quite confused?

wgl2014

Have you had a look to see what your car is worth as a trade in?

If it's more than 9k (unlikely) then you have some extra value in the car, if it's less you will need to cover the shortfall if you change.

Remember that PCP has three payment phases, a deposit followed by a number of monthly payments with a lump sum at the end. Some people seem to misunderstand and think they get the final figure back somehow.

daveyjp

OP as you have stated 'I don't know how it works' do not enter any car dealership until either you do or you go with someone who does.

You will be a sales staff dream customer.

facade

The best way to save money is to pay the £9000 settlement figure in cash, and run the car for another 10 years, which works out at £75 a month.

The second best I suppose is to keep on with the pcp until it ends, and then either hand it back if it is worth less than the final payment, or pay for it if it is worth significantly more.


The absolute worst way to "save" money (or the best way to waste it ) is to swap the car for another pcp and roll up the current negative equity into the deal (unless you like paying interest on interest)

Especially as you are after the same car, but 2 years newer!

rhysadams

On some PCP deals, if you pay a certain amount you can actually do a termination. I managed to do this on an Audi A6 with VWFS.

facade

To VT (voluntary terminate), handing back the car in good condition and walking away with nothing whatsoever, you have to pay whatever it takes to get to 50% of the amount financed plus interest. Unless you paid a huge deposit, you won't be anywhere near this point 2 years into a 4 year pcp.

The easiest way to do this is keep on with the current pcp until the VT point is reached. You then will probably want to buy another car......

neilmcl

rhysadams wrote: »

On some PCP deals, if you pay a certain amount you can actually do a termination. I managed to do this on an Audi A6 with VWFS.

You can voluntary terminate on all finance deals, it's a statutory right.

G_M

neilmcl wrote: »

You can voluntary terminate on all finance deals, it's a statutory right.

Yes. At a cost.

Trouble is PCP is the car is not yours and you're financially locked in. You can't just do what ou want, when you want, without costs.

have stated 'I don't know how it works' do not enter any car dealership until either you do or you go with someone who does.

You will be a sales staff dream customer.

As was the case 2 years ago........

worried_jim

Op - I suggest you watch last nights ch4's dispatches to prevent yourself getting spanked again.-

http://www.channel4.com/programmes/dispatches/on-demand/66549-001

bigadaj

DD1A wrote: »

What is the consequences if someone was to terminate their 4 yr pcp at 1y7m which was not near the VT point and not pay the remaining balance?

You'd be pursued for the balance, just like any other loan on which you'd defaulted.

System

DD1A wrote: »

How about if something failed on the vehicle could it be rejected this far in?

Not a chance. You only get that option for the first few weeks/months, certainly not even a year let alone two. And if something did fail which wasn't covered by the warranty it would have to be fixed at your expense as VT requires a vehicle to be returned in a decent roadworthy and running state. So pouring a load of sugar in the tank to shaft the engine so you can get out of a PCP deal you wish you'd never taken out isn't likely to work out how you want it to.