PCP advice - take it not?

DrEskimo

Set the mileage as high as possible, go over the shortest term possible, and put down the highest deposit possible. This will help reduce the interest per month.

Pay down the loan as much as possible the day before and then let it run a few month and the interest will be minimal, making the PCP the better value.

lopsyfa

The 3 months is probably the time at which the dealership can get to keep the commission from the finance house but this comes at a disadvantage to you - you have to pay the 28 or 56 days interest on the balance on settlement except the finance company don't charge this. It is usually best to settle within the first 14 days after taking the finance to avoid this interest and you still get to keep the contribution.

I should also point out that you are not borrowing £8k but rather you are borrowing £47k. Interest will be charged on the £47k but you have the guarantee from the finance company to buy the car back from you for £39k which you can use to settle the outstanding finance at the end. This is why the amount of interest will be considerably more than borrowing £8k at the same APR. 

Flight3287462

To me there appears to be no incentive to take out a PCP contract (to pay it off), wait a few months and demand will have fallen off a cliff ands then you can haggle hard on the price.  Get a better deal and haggle hard.

What car is it?

FatherDougal

It's a Porsche Cayman GTS4.  Appreciate it's not a Ferrari, but they're made to order, made in very small numbers and pretty much all those on sale used are as or more expensive than new - the residuals are really strong. Porsche really aren't known for giving discounts off this model (or most models).  I appreciate all the haggle hard comments, but it really is a different market, and demand doesn't fall off a cliff.  I'm confident I've got a decent deal, was just after advice on the financial aspect!

ontheroad1970

Might be better to ask somewhere like Pistonheads or elsewhere where there are more people who like the more exotic to get a wider view...

daveyjp

Not much discount on new Porsche and I know specifications are very personal, but they do lose money.  This one was over £100k new.

https://www.dales-subaru.co.uk/used/porsche/cayman/40-cayman-gt4-2d-415-bhp/barnoldswick/lancashire/19381224/

To maintain value you need to keep them a long time (decades!) and spend what is needed.

Penelopa.Pitstop

FatherDougal said:

It's a Porsche Cayman GTS4.  Appreciate it's not a Ferrari, but they're made to order, made in very small numbers and pretty much all those on sale used are as or more expensive than new - the residuals are really strong. Porsche really aren't known for giving discounts off this model (or most models).  I appreciate all the haggle hard comments, but it really is a different market, and demand doesn't fall off a cliff.  I'm confident I've got a decent deal, was just after advice on the financial aspect!

I had an order on GT4, which was cancelled, because there was no available production slots.

I wouldn' bother with PCP in this case. Too much hassle to apply for it and then pay it off.

MalMonroe

I have a car on PCP for two years, started September 2019. For the whole time it is 0% interest on repayments and I can pay it off at any time, so I'm as happy with that as anyone can be when they're paying monthly for a car which isn't actually theirs.

However, if I'd had the money to buy a car outright, at any time, that is what I'd do. I wouldn't bother with trying to save a bit of money here and a bit there if I had the cash to buy an £80k car outright.

If you offered them the cash (have you discussed this with them already) - you could haggle over price? 

I wouldn't want to ever take on PCP or HP or any other hire purchase type agreement, if I had the money to pay upfront. Sadly, I've never been in that fortunate position. 

This is just my own opinion, of course. But I'd try some haggling, then pay in full. You can afford it!

A_Lert

I know this is MoneySavingExpert, but you're looking at a whole bunch of extra complication to save 1.3% of the cost. I'd just buy it outright.

timwalker

Why do people on here so over-complicate things?
Take the deposit contribution, drive the car away, and pay the finance off the next day. You are 100% within your rights to do this.

Job done.
It's really not difficult.