Personal loan to pay off PCP

Kellybissett

I have £18k left on a PCP to repay over 35 months. I want to get rid of the PCP (stupid mistake please don’t judge). There are big numbers to consider so any help would be appreciated:

Loan for £40k
Repay PCP £33k
Buy cheaper car £7k

Proceeds of PCP car sale £29k to immediately repay off car loan leaving £11k to repay.
I would need a loan that I could repay a large sum immediately without being penalised and I presume the interest quoted on the initial loan would be reduced following the repayment of £29k.
Has anyone done this before? Are there any lenders you could recommend? Is there anything else I should consider, apart from the cost of the loan which I presume would be around £1k over 36 months.
Any help would be appreciated.

[Deleted User]

If you're looking to borrow 40k, you'll need a secured loan.

But on top of your existing 18k, you're going to need a high income and impeccable credit history to even stand a chance. Without knowing more about your circumstances, it's not looking likely.

But if you only have 28k on the PCP, why would you repay 33k?

Kellybissett

Deleted_User wrote: »

If you're looking to borrow 40k, you'll need a secured loan.

But on top of your existing 18k, you're going to need a high income and impeccable credit history to even stand a chance. Without knowing more about your circumstances, it's not looking likely.

But if you only have 28k on the PCP, why would you repay 33k?

I have good credit and high income. Over 3 years I would give Audi £18k with nothing to show at the end (apart from driving around in a shiny car). If I took out the loan I would just pay £11k and have a cheap car at the end.

foxy-stoat

Doubt you will get a loan for £40,000 without ripping it out of your home equity, assuming you have the income to support it and assuming that your lender allows it.

Doubt you will get the lowest rate of interest - factor the interest you will pay over the total term.

You 110% sure that you will be able to sell your car for £29,000 cash?

You WILL get penalized for repaying £29,000 on the secured loan, factor that in.

You are going to need to keep paying the same monthly amount so the loan will get paid off earlier - rather than reducing the monthly payment and paying more interest for something that you dont have.

I would work out your 50% point and had back the car and never do something like this again....which will probably be a few months from the end of the term.

foxy-stoat

Kellybissett wrote: »

I have good credit and high income. Over 3 years I would give Audi £18k with nothing to show at the end (apart from driving around in a shiny car). If I took out the loan I would just pay £11k and have a cheap car at the end.

Bit late to come to that conclusion - your signed up.

DrEskimo

What is the settlement figure, and how much has the Audi been valued at if you were to sell to a trader today?

It will be much easier to just trade the car in and settle the finance. You can try different dealers, Tootle.com and even local garages that will do a sale or return agreement to try and get as close to the private sale figure as possible.

How much do you have in savings? Do you have enough to be able to settle the shortfall and buy a much cheaper car for cash? I would do that rather than borrowing £7k to buy another car. I know relative to the Audi it's cheaper, but it's still not cheap!