Financing my Car PCP GFV amount

d4zza

Hi folks, looking for some advice on how I can finance the "ballon" payment at the end of my car PCP contract.

I purchased a car for £27000 in 2018 and borrowed £24000 (I had £3000 cash to add).  The finance company PCP contract gave me a Guaranteed Future Value of £13000.  As it turns out, I absolutely love the car, and because I've kept it low mileage, it's worth significantly more than the GFV amount.  Because of these two factors I'd prefer to keep the car but as I'm sure like most people I don't have the GFV cash in my back pocket to pay off.  I'd be gutted to hand the car back, and even these car buying services are quoting minimum £18000 to buy it off me (yes I know they'll all look to knock that down).  As my preference is actually to keep the car, does anyone have experience of getting their PCP finance provider to provide a straight up car loan to pay the GFV or going to any other car finance company?  I'd expect it difficult to acquire a £13000 loan when I have a loan which technically would still be outstanding.

I hope I've explained that ok, basically I want finance to clear off the GFV amount.

thanks.

[Deleted User]

The PCP or other car finance company won't provide you with a loan, so you would need to look at a personal loan.  However, you'll need a decent income and very good history

d4zza

Deleted_User said:

The PCP or other car finance compay won't provide you with a loan, so you would need to look at a personal loan.  However, you'll need a decent income and very good history

Thanks for the response, history is good yes and I do have what I'd consider a decent income.  I'd be gutted at not being able to keep this car.

DrEskimo

You can certainly ask the question of your existing finance provider. I have heard anecdotally from others that they have been offered ways to re-finance the final payment, but it's probably unlikely.

You will probably have difficulty given your PCP will count as an outstanding loan, so the question is whether you think you will pass the affordability checks to double your current debt (£13,000) on the car.

If not, you may have to look at selling to the highest bidder (~£18,000), then taking that equity and applying for finance on another car. Or, just make do with a £5,000 car and have no debt at all. Build up the monthly payment in your own savings account for a replacement down the line.

Nearlyold

As well as approaching your current PCP lender (no harm in asking as they can some times assist)  you could ask the Dealer, they can often arrange to notionally buy the car from you then "sell" it back and arrange new finance BUT it probably won't be a competitive rate. Simplest way would be  a loan from your bank however the days of the local manager being able to make a decision are long gone.

[Deleted User]

Why not use the money you put aside to pay it off during the PCP period?

d4zza

Deleted_User said:

Why not use the money you put aside to pay it off during the PCP period?

Apologies if I didn't explain that part, I didn't put any money aside.  It's the first time I've done PCP finance and I didn't that I'd want to keep the car or that the value would be so much higher than the final payment.

Aran76

I recently paid off my PCP with a bank loan that was initially declined (due to the outstanding PCP amount) but I was given a chance to appeal. I set out my case with exact figures of what I was going to do and they then accepted the application on the understanding that I use the funds to settle the car finance. You could do some shopping around for loans, maybe speak to your own bank also. 

[Deleted User]

d4zza said:

Deleted_User said:

Why not use the money you put aside to pay it off during the PCP period?

Apologies if I didn't explain that part, I didn't put any money aside.  It's the first time I've done PCP finance and I didn't that I'd want to keep the car or that the value would be so much higher than the final payment.

They knew that - they were just trying to be "clever" and prove a point that you should have saved. Just ignore them - everyone else does.

mamabuddah

Strange one this, my son had a car on a PCP, when it came to the end of the term and there was a balloon payment, he got a loan from Tesco bank to clear the balloon payment, from memory the amount was about £7k and he got the loan at 3.9% or thereabouts...wonder is it worth trying the loan checkers on here.