Can I cancel car finance after 6-8 months

simpson_77

Hi,

Quick question. I'm looking to buy a fun car (M5 E63 AMG etc) to run for 6-8 months for circa £35-40k, Then I will sell / PX for a family 7 seater (XC90 / GLS New Discovery).

I'm looking at different finance options, and wondering which would be the best one for lower payments and ease of repaying when I sell the car. E.g can I do PCP 4 year term, but cancel 6 months in?

Cars I'm looking at will be 2-3 years old with around 20-30k miles.

Thanks,

iolanthe07

E.g can I do PCP 4 year term, but cancel 6 months in?

Yes, you can, but when you come to trade it in you'll take a hell of a hit financially.

StopIt

Yes, but cancelling so soon on a performance car could well end you with a five figure sum in negative equity when you do.


That'll then need to be added to the next finance or paid. Have you the means to do that?

simpson_77

My thinking is to buy low mileage and put a maximum of 10k on it, so it shouldn't lose too much in value. its just finding the right finance option. i thought about HP, with £10k deposit and selling for the same or marginally less then I paid, In theory all I would lose is the interest I paid for that period correct?

tykesi

I assume if you're buying with HP you're buying from a dealer? There's next to no chance of selling "for the same or marginally less then[sic] I paid because if you sell privately nobody will pay dealer prices for a car on the private market and if you sell to a dealer you're only going to be offered trade price.

For an idea of how much you'd lose find a car at a dealers then plug the reg into We Buy Any Car the difference is what you're likely to lose.

StopIt

simpson_77 wrote: »

My thinking is to buy low mileage and put a maximum of 10k on it, so it shouldn't lose too much in value. its just finding the right finance option. i thought about HP, with £10k deposit and selling for the same or marginally less then I paid, In theory all I would lose is the interest I paid for that period correct?

Basically, do the following.


Look for the car you want, and find the price for it.


Put the registration in a car buying website (Think the one with multi coloured cars in the logo).


Note the difference in the price you'll pay and the price they'll pay.


Of course you'll need to settle the finance too, so any outstanding interest etc.


If you find that amount acceptable for playing with a car for 6 months, go right ahead!

tykesi

StopIt wrote: »

Basically, do the following.


Look for the car you want, and find the price for it.


Put the registration in a car buying website (Think the one with multi coloured cars in the logo).


Note the difference in the price you'll pay and the price they'll pay.


Of course you'll need to settle the finance too, so any outstanding interest etc.


If you find that amount acceptable for playing with a car for 6 months, go right ahead!

Not that this is a p!ssing contest but didn't I just say that?

Lucky_Duck_2

Probably cheaper to hire or lease one?

ReadingTim

tykesi wrote: »

Not that this is a p!ssing contest but didn't I just say that?

If the OP thinks his plan is a good one, he probably needs it spelling out why it's not. In very simple steps. Your post had too many words...

System

simpson_77 wrote: »

My thinking is to buy low mileage and put a maximum of 10k on it, so it shouldn't lose too much in value

The mileage won't be what causes you to take a wallet pounding, time is. By the time you come to sell it it'll be yet another registration letter behind a new one which will hit its value. If there has been a facelift since then expect to get doubly hit.

Look on Ebay for similar cars which have been sold and look at what the amount they've sold for by age is. That'll give you some idea of the depreciation.

High performance cars like that which are widely available depreciate like you wouldn't believe.

StopIt

tykesi wrote: »

Not that this is a p!ssing contest but didn't I just say that?

I hit Reply, and started my reply before your post appeared.


Nothing wrong with a consensus however.


Still, my PM box is always open if you're not happy with my postings in any way!