What is the likelihood I will be accepted for PCP?

JoshGadd91

Hi,

I appreciate it may not be possible to give me a definitive answer.

I've just put down a deposit of £1,200 on a car valued at £6,995. I only have a fair credit rating according to Experian, Equifax and ClearScore, due to a credit card with a limit of £500 that I have used. I am however paying that off regularly and I pay over the minimum recommended amount. I have no history of CCJs, bankruptcy and bar the credit card, I have a very clean history.

Am I likely to be accepted?

Warm regards,

Josh.

loskie

first of all PCP is likely to be a bad idea on a used car, I am guessing this is pretty used due to the price.
Have you looked at a loan or HP instead?

JoshGadd91

I was reluctant to take out a loan or use HP as the costs are higher. This will be my first car so I wasn't planning on buying it at the end of the contract.

DrEskimo

You can still trade the car in at the same time as the PCP contract ends. You will get the same valuation, and it's likely that the GFV on the PCP is unrealistically low to be of any use financially.

You need to look at the total cost of ownership, not the monthly cost. Get a personal loan at a lower rate and dramatically reduce the interest you pay, then trade in whenever you want. Its cheaper and more flexible, as you have no punitive mileage limits, no limits on how long you can keep it, and it's much easier to sell privately if you want to get a better return on the car when you decide to change.

silverwhistle

.. and if it's running well when the loan finishes keep it and start saving the money for the next one.



My first car was a £100 banger, sold after 10 months for £70 so if it had really gone bang no great loss. About 300 in today's money, and you probably get a working radio and less rust these days! But £7000 with most on a loan seems risky to me.

DUTR

JoshGadd91 wrote: »

Hi,

I appreciate it may not be possible to give me a definitive answer.

I've just put down a deposit of £1,200 on a car valued at £6,995. I only have a fair credit rating according to Experian, Equifax and ClearScore, due to a credit card with a limit of £500 that I have used. I am however paying that off regularly and I pay over the minimum recommended amount. I have no history of CCJs, bankruptcy and bar the credit card, I have a very clean history.

Am I likely to be accepted?

Warm regards,

Josh.

I must ask , why have you put down a deposit before arranging some kind of finance?

Scrapit

JoshGadd91 wrote: »

Hi,

I appreciate it may not be possible to give me a definitive answer.

I've just put down a deposit of £1,200 on a car valued at £6,995. I only have a fair credit rating according to Experian, Equifax and ClearScore, due to a credit card with a limit of £500 that I have used. I am however paying that off regularly and I pay over the minimum recommended amount. I have no history of CCJs, bankruptcy and bar the credit card, I have a very clean history.

Am I likely to be accepted?

Warm regards,

Josh.

You probbably have a lower credit score because you don't have much credit.

foxy-stoat

DUTR wrote: »

I must ask , why have you put down a deposit before arranging some kind of finance?

That what I was thinking, you really should be spending the £1200 on your first car and no monthly repayments. What about insurance, if you are a young'un you will need that again and then some.

Clive_Woody

JoshGadd91 wrote: »

Hi,

I appreciate it may not be possible to give me a definitive answer.

I've just put down a deposit of £1,200 on a car valued at £6,995. I only have a fair credit rating according to Experian, Equifax and ClearScore, due to a credit card with a limit of £500 that I have used. I am however paying that off regularly and I pay over the minimum recommended amount. I have no history of CCJs, bankruptcy and bar the credit card, I have a very clean history.

Am I likely to be accepted?

Warm regards,

Josh.

Don't mean to be rude but if you are taking your time to clear a £500 balance on a credit card, presumably at a high APR (%), then can you afford repayments on a £7k loan....plus save to be able to make any final payment to purchase the car?

As suggested, it might be better advise to start with a cheaper car, and if you have £1200 in the bank use that to buy the car. Insurance, servicing, MOT and general maintenance also need to be budgeted for.

MEM62

Getting accepted for the PCP won't be your only issue. (Can you even get PCP for a £7K car?)

You problem will come when the car has a major issue. Assuming that it is an older car and that there is no warranty, you could place yourself between a rock and a hard place where you cannot afford to repair it, as you cannot scrap it because it is not yours and must return it in working order at the end of the PCP deal.

PCP on older, out of warranty cars is risky. Buy an older vehicle, stay within your budget and pay cash. At least that way you can walk away from it if you have to.

neilmcl

As others have said, forget the PCP route, they're not designed for used car purchases, especially for vehicles outside their warranty periods, you're only asking for trouble down the line. If you can't get a cheap bank loan then use the cash you do have and get something more within your means. £1200 will get you a reasonable runabout.