PCP interest rates

daveyjp

On a long term PCP VT isn't a major consideration as the 50% payment point is typically only a few months from the date the agreement ends.

Grumpy_chap

Towelman said:

I did look at the 0% deal, its what made me look there originally, but having looked at 6 different options (i'm swimming in proposals) a 9 month old car made more sense as the 0% is on new cars.  Of course you lose driving off the forecourt.  It does feel all the different interest rates bring everything to about the same price!

What discount off list price can you get buying new?  It may end cheaper to have the new car than used.

Towelman

Grumpy_chap said:

Towelman said:

I did look at the 0% deal, its what made me look there originally, but having looked at 6 different options (i'm swimming in proposals) a 9 month old car made more sense as the 0% is on new cars.  Of course you lose driving off the forecourt.  It does feel all the different interest rates bring everything to about the same price!

What discount off list price can you get buying new?  It may end cheaper to have the new car than used.

It worked out I could get an entry level car new (at 0% finance) for about £1400 more than a much higher spec used car that had done 7000 miles. Although the 0% seemed attractive it didn't really work out to be so.

Towelman

bazzyb said:

Towelman said:

Nearlyold said:

Nowt to do with the interest calculation, but did you realise that's an example of a Fixed Sum agreement, you may or may not like to know that it doesn't have Voluntary Termination rights.

So am i right in saying I would need to pay up to 50% of the agreement to terminate?  I get this is likely to be later that halfway through the agreement. More reason to get a loan, or just stick with my old car!

With a ‘normal’ PCP based on HP or CS then yes, 50% of the total including the balloon. However Santander also offer what is essentially a loan with a balloon and call it a PCP - you can still hand the car back at the end instead of paying the balloon but because it’s technically a fixed sum loan you aren’t able to VT at all. 

Thats great to understand Bazzyb, thanks!

32Battalion

Why are you looking just now, the manufacturers are having a post lockdown purple patch that will not last long, if you can wait a bit.

Do you really want to spend that much on car that will be out of warranty well before the PCP expires?  42 months is a long time.

Towelman

I've been looking for over a year and  was about to enter an agreement just as lockdown happened. My volvo has done 215,000 miles so I need to update somehow, I spend so much time keeping it going!