Selling a car you just bought on finance

fireblade28

I have a predicament I just bought a new car like 2 months ago but it looks like I may have to move and there’s not much point having a car in central London.

I have the money to pay of the finance agreement if required but will I lose out a lot of money due to interest or do you not have to pay that? It’s on PCP.

I figure I can just buy the car and then sell it but I may keep it if I’m gonna lose out like 10k on interest

Frozen_up_north

You need to ask the finance company for a settlement figure, they issue them all the time, mostly when someone trades in their car for a new one.

neilmcl

fireblade28 wrote: »

I have a predicament I just bought a new car like 2 months ago but it looks like I may have to move and there’s not much point having a car in central London.

I have the money to pay of the finance agreement if required but will I lose out a lot of money due to interest or do you not have to pay that? It’s on PCP.

I figure I can just buy the car and then sell it but I may keep it if I’m gonna lose out like 10k on interest

If you have the money then settle the finance and keep the car. The only interest you'll pay is for the 2 months you've owned the car, which I imagine will not be much.

AnotherJoe

I've done this a couple of times (settling the finance) after a few weeks just to take advantage of the finance contributions they offer. As advised, just ask them for a settlement figure and how you can pay, ISTR last time they just took it via the same DD number, so i just had to make sure i had the money in my account.

There's nothing to lose out on regards settling*, indeed you'll gain as you wont be paying interest.

Expect to take a big hit on depreciation when you sell it.

* do ask them for the settlement figure, dont say you want to cancel it. Thats different.

bigadaj

Settling the finance in the car is probably not going to be very expensive, certainly compared to the depreciation on selling teh car after a couple of months.

footyguy

fireblade28 wrote: »

I have a predicament I just bought a new car like 2 months ago but it looks like I may have to move and there’s not much point having a car in central London.

I have the money to pay of the finance agreement if required but will I lose out a lot of money due to interest or do you not have to pay that? It’s on PCP.

I figure I can just buy the car and then sell it but I may keep it if I’m gonna lose out like 10k on interest

Can I ask, why did you recently take out the finance agreement if you had the cash to buy the car outright?

You fear £10k worth of interest (I hope not, even over the whole term) but you are not going to earn that in any savings account.

AnotherJoe

footyguy wrote: »

Can I ask, why did you recently take out the finance agreement if you had the cash to buy the car outright?

You fear £10k worth of interest (I hope not, even over the whole term) but you are not going to earn that in any savings account.

I've done it because I got £2 or £3k extra for taking out their finance. Settle after a couple of weeks.

footyguy

AnotherJoe wrote: »

I've done it because I got £2 or £3k extra for taking out their finance. Settle after a couple of weeks.

So you presumably already knew you were not going to get clobbered by £10k worth of interest by paying the loan off early

Likewise, I've done it the the past, ... but that was on an interest free deal.

AnotherJoe

footyguy wrote: »

So you presumably already knew you were not going to get clobbered by £10k worth of interest by paying the loan off early

Likewise, I've done it the the past, ... but that was on an interest free deal.

Yes, though it was a few years ago, one of the deals may have been interest free, pretty sure one wasnt, but there's no concept of them making you pay up the interest you would have paid over the term, i dont think its even legal. Possibly you might pay a month or two.

Herzlos

Most they can charge you is 2 months interest when you settle early.

That'll be a rounding error compared to the loss on selling a 2 month old car. Any friends/family in the market for a new car?

Without knowing the car it's hard to estimate how much you'll lose, but I'd expect it to be at least 10% of the new value.