PCP renewal question

Rhym3z

Hi guys first time poster here.

I'm in the process of potentially getting a new car on PCP but I have a question that I haven't been able to find an answer to and wondered if anyone can help.

If I get a car on PCP over say, 4 years, at the end of those 4 years, we decide to get the exact same car again for another 4, would the 1st 4 years payment we already paid continue to contribute towards the final (balloon) payment? Or will we have to start the entire deal from scratch?
If that makes sense

NottinghamKnight

The best way to think about it is you are renting the car. At the end of the deal you can hand it back or pay the balloon and retain the car. You can vary deposit and payment against the balloon if that helps, but starting a new deal is just that.

neilmcl

Rhym3z said:

Hi guys first time poster here.

I'm in the process of potentially getting a new car on PCP but I have a question that I haven't been able to find an answer to and wondered if anyone can help.

If I get a car on PCP over say, 4 years, at the end of those 4 years, we decide to get the exact same car again for another 4, would the 1st 4 years payment we already paid continue to contribute towards the final (balloon) payment? Or will we have to start the entire deal from scratch?
If that makes sense

You start again from scratch. If you have do have any equity in the first car, which would be doubtful, then you can use this as a deposit for the new one. If you thinking about changing your car every 3-4 years and never interested in actually owning the car then you'd probably find a personal lease hire option better and likely cheaper.

Grumpy_chap

Rhym3z said:

Hi guys first time poster here.

I'm in the process of potentially getting a new car on PCP but I have a question that I haven't been able to find an answer to and wondered if anyone can help.

If I get a car on PCP over say, 4 years, at the end of those 4 years, we decide to get the exact same car again for another 4, would the 1st 4 years payment we already paid continue to contribute towards the final (balloon) payment? Or will we have to start the entire deal from scratch?
If that makes sense

No.  The money in the first 4 years will be gone.  You cannot spend the same money twice, more's the pity.

Ectophile

The balloon payment is the final patment on the credit purchase.  Nothing you have paid up to that point counts towards it.

At the end of a PCP, you have three choices:

1. Hand the car back and walk away.
2. If the car is worth more than the balloon payment, trade it in at a dealer.  The amount you will get will be the difference between the value of the car and the balloon payment.  That won't be a huge amount, and will probably disappear as part of the deposit for the next car.
3. Pay the balloon payment, and keep the car.  It's now yours.