Help! Confused pcp used or new.

Kias1992

Hey!

I need advice! I don’t have many family + friends around and the ones I do not have are not experience in the area I’m about to discussed although I have tried to research as much as I can so think I have some basic understanding!

So this is in regards to a new car that I have always wanted! A brand new Ford Fiesta!

Currently I have a hire purchase car that I have had from Arnold Clark for a 1 year and a half! I’m desperately wanted to trade up as I bought the car when I was a student and now qualified want something a little wih a better engine so I can see my sister that’s 5 hours away from me. Rang the finance company who stated my settlement figure was 4100.

Went to Evan Halshaw who have said part exchange there’s some negative equity (600) but said that Add that on and to pay 215 deposit! Offered me a PCP new Ford Fiesta for 230 a month including the negative equity and for 48 months!

A friend said you shouldn’t by new cars as they drop in price drastically and to buy used! They have a lot of neg equity for new cars. So shopped around found the same car which is used for 200 pound a month with 1000 deposit! 1200 miles and 2017 plate for 48 months

I’m stuck between two deals! They bombard you with calls and eager for me to take their deals. And honestly have no idea which path to take! One sales man like ford don’t lose their worth easily and another that used are better as your not tied down. Each car salesman says their deal is better but just want unbiased advice!

Thanku in advance

flashg67

As someone who has made bad decisions in the past, personally, I'd try to hang on until I had at least paid some more off so there was no negative equity. All you're doing is delaying the pain until further down the line, plus you'll be paying interest on the negative equity if you take one of these deals. You'll be in a better position to negotiate too
New cars do drop in value quickly, but some of that is off set by some of the discounted deals/cheaper interest rates.
On your deals above, presumably the new car PCP leaves you with a balloon payment after 4 years, whereas the used one , you will own at the end.
If you maust have a new car, does it have to be a Fiesta? There's some good deals on the 'old' shpe Peugeot 208 (new model due in Jan) or Corsa - eg https://www.vauxhall.co.uk/corsa-griffin.html?ppc=GOOGLE_700000001664021_71700000029762798_58700003687880372_p29022781924&_vsrefdom=mca&gclid=EAIaIQobChMI5tvSyc695QIVRLTtCh3XqQ1_EAAYASAAEgIl8PD_BwE&gclsrc=aw.ds

loskie

PCP is better value on new cars than used. You are not inheriting damage and issues that you could potentially be charged for.
The costs for new versus nearly new will be pretty much the same.

BUT dont see PCP as ownership see it as leasing or renting. Maybe as you are still a newish driver you should run your current car for a bit, gain experience.
You dont want to damage a new car.

BEST BIT OF ADVICE
Dont believe any of the sales people/advisers/specialists or whatever they choose to call themselves. They are all liars and just after your money.
Look at online sites like Carwow too.

Goudy

Whatever you do, don't rush into anything.

For starters, not everyone is a fan of PCP for different reasons, so it's best to research that and be aware of what it all means to you if you did sign up.

Next up, it's a fair statement that used cars on PCP tend to work out quite expensive. For a start finance rates tend to be a lot higher on used cars and you won't qualify for any deposit contributions that might be offered.
The ownership/payment plan will usually take you beyond the warranty and there will not doubt be wear and tear items that need replacing while you're still paying it off where you shouldn't need to bother with anything other than servicing on a new car for a couple of years.

With regards to rolling your negative equity, don't.
You should be able to negotiate this down to nothing if you tried.
You might not be able to do this at the first dealership, but shop around and dig your heels in on it and it's should be possible to get a straight trade in where they will settle the finance on your current car.
£600 isn't a massive amount to negotiate.

But writing all that, I would be tempted to settle the finance on your current car with a cheap loan or 0% credit card and pay that off as quickly as you can, now that you are no longer a student and are working/earning?? £4100 shouldn't be difficult to sort in a reasonable amount of time, use the £230 a month and it would be paid off in 18 months.

The settlement figure should give you an indication of what interest you'll save by paying it off early, so just make sure the credit to pay it off doesn't cost you more than that.

Once settled and the loan paid off, you'll be in a much better place to negotiate a new car as you'll now have some value in your trade in rather than negative equity.

In the mean time, it's worth researching your new car, what you want/need out of it in terms of use and kit and how best to buy it.

You don't say what you do or where you work, but there are schemes around that might save you a large slice of cash via your job/occupation.
You'd be surprised what is offered if you know what to ask, I've seen schemes for NHS, Police, Military along with BT and M&S staff, British Cycling members and Union membership.

Supersonos

Kias1992 wrote: »

Hey!

I need advice! I don’t have many family + friends around and the ones I do not have are not experience in the area I’m about to discussed although I have tried to research as much as I can so think I have some basic understanding!

So this is in regards to a new car that I have always wanted! A brand new Ford Fiesta!

Currently I have a hire purchase car that I have had from Arnold Clark for a 1 year and a half! I’m desperately wanted to trade up as I bought the car when I was a student and now qualified want something a little wih a better engine so I can see my sister that’s 5 hours away from me. Rang the finance company who stated my settlement figure was 4100.

Went to Evan Halshaw who have said part exchange there’s some negative equity (600) but said that Add that on and to pay 215 deposit! Offered me a PCP new Ford Fiesta for 230 a month including the negative equity and for 48 months!

A friend said you shouldn’t by new cars as they drop in price drastically and to buy used! They have a lot of neg equity for new cars. So shopped around found the same car which is used for 200 pound a month with 1000 deposit! 1200 miles and 2017 plate for 48 months

I’m stuck between two deals! They bombard you with calls and eager for me to take their deals. And honestly have no idea which path to take! One sales man like ford don’t lose their worth easily and another that used are better as your not tied down. Each car salesman says their deal is better but just want unbiased advice!

Thanku in advance

Sometimes, a full stop is fine.

AdrianC

What's wrong with your current car that you can't drive five hours in it? If you're returning it to the finance house, they'll want it in good mechanical condition, so you're going to get hit with penalties if it's as broken as you suggest. Or are you just being a bit melodramatic?

£230/mo x 48mo + £215 = £11,255 - and you hand the keys back at the end, or pay the balloon to keep it.

I suspect the 2yo used car is an outright purchase at that price, not a PCP - so in four years time, the difference is that you own a car versus have nothing at all. Even then, it doesn't sound particularly cheap. A quick look at Autotrader shows plenty of 2yo Fiestas around the £8k mark, with some below £7k.

As for depreciation - it takes two seconds to look at what a new Fiesta costs and what a 2yo equivalent one costs...

Mercdriver

Supersonos wrote: »

Sometimes, a full stop is fine.

Sometimes making a reply that helps rather than trying to make yourself look clever is fine. Next time save the thought and imagine you typed.

Kias1992

Hi I’m a midwife they do my car would cos 300 pound a month everything included car, tax, insurance service and breakdown but I heard I could get hit with tax at the end cos it’s salary sacrifice?

Kias1992

Not melodramatic just worked my !!! at uni and want to treat myself to a new car! Just want a good deal too and people’s opinions 🤷🏽!♀️

AdrianC

Kias1992 wrote: »

Not melodramatic just worked my !!! at uni and want to treat myself to a new car!

OK, and such is your prerogative... But I was just wondering at the "But I can't see my sister five hours away" justification - because if you really CAN'T, then you are going to have to fix that car before it goes back.

Kias1992

My car is perfect working condition it’s just a city car with a very small engine. Defo not designed for long drives as would get my there as fast