Finding a Bank loan instead of PCP for a car worth £60k+

Grumpy_chap

bengalknights said:

Might actually be cheaper to lease than own the car depending on depreciation

That can't work.  The lease cost has to cover all the depreciation plus the profit that the lease company makes.  Assuming the private buyer can negotiate on the price in the first place.

dano17439

The PCP rate of 5.9% isnt too bad at all compared to some rates which can be 10%+. Why not take that deal and screw the price down at the dealer/negotiate free servicing/extended warranty on the proviso they take the finance deal, and then when the balance owed reached say 25k, re-finance with a personal loan circa 3%?

pjcox2005

Not a loan response but have you looked at using sites like Carwow?
I haven't used it for a few years, but when we bought our last car (much more modest Qashqai ;-) ) we used it. Basically put in specs of what you are after and the dealers compete around the country on price. They may be a bit more tired of it now, but I think you'd see a difference in price as a dealer for example may be close to a sales target if they can get one more car out. Worth a look.

macman

Totally depends on what the vehicles is. Some makes and models are available with huge discounts, some with next to nothing off. 

ratechaser

pjcox2005 said:

Not a loan response but have you looked at using sites like Carwow?
I haven't used it for a few years, but when we bought our last car (much more modest Qashqai ;-) ) we used it. Basically put in specs of what you are after and the dealers compete around the country on price. They may be a bit more tired of it now, but I think you'd see a difference in price as a dealer for example may be close to a sales target if they can get one more car out. Worth a look.

I found Carwow to be a very useful starting point for price negotiations on my last car (which wasn't cheap, although not up to the 60k mark!) - assuming you're going for a widely available model then there's generally a good level of price competition and haggling to be had. I've always paid less than sticker price although I understand that haggling isn't for everyone. But I suspect this is where the real savings are to be made here, not on the loan itself...

FaceHead

Two suggestions for discussion: 1. Take a 25k personal loan each. Above 25k personal loan rates rocket, but at 25k, rates of < 3% are available, and there are two of them (albeit with linked credit records, probably)
2. Take a mortgage. Seems drastic for a car, but so is spending 60k on a car. Securing against a property, if they have one with adequate equity, chould get a rate of <1.5%

macman

Good suggestion to take 2 personal loans, but is it really sensible to take  a second mortgage out on a car that will have gone to the crusher years before the mortgage loan is paid off? 

bailey_uk

dano17439 said:

The PCP rate of 5.9% isnt too bad at all compared to some rates which can be 10%+. Why not take that deal and screw the price down at the dealer/negotiate free servicing/extended warranty on the proviso they take the finance deal, and then when the balance owed reached say 25k, re-finance with a personal loan circa 3%?

This does actually have the best of both worlds yeh, its how I did my personal 25k car and since then vowed never to never take PCP again if an initial loan is available at the start, but you are right that is a good way to do a car that is initially out of reach. pjcox2005 said:

Not a loan response but have you looked at using sites like Carwow?
I haven't used it for a few years, but when we bought our last car (much more modest Qashqai ;-) ) we used it. Basically put in specs of what you are after and the dealers compete around the country on price. They may be a bit more tired of it now, but I think you'd see a difference in price as a dealer for example may be close to a sales target if they can get one more car out. Worth a look.

Is that the same as Drive The Deal? I will definitley consider this in the future.
Thanks for taking the time to reply everyone, some great suggestions here.
I will wind my neck in for dismissing PCP so quickly as I know it does have its uses!

Grumpy_chap

Carwow is not Drive the Deal, but the same type of thing, along with Broadspeed, and any other number of brokers.  Carwow seem to operate slightly differently, but the same idea to get dealers bidding for your business or introduce you to the dealer with a deal that day.

Always, get the best price before thinking about how to finance.  I am not a fan of PCP, but it can work well if there are good incentives.

Why does anyone want a £60k car on credit when they can buy a £15k or £20k car outright?

Herzlos

Grumpy_chap said:

bengalknights said:

Might actually be cheaper to lease than own the car depending on depreciation

That can't work.  The lease cost has to cover all the depreciation plus the profit that the lease company makes.  Assuming the private buyer can negotiate on the price in the first place.

The only way it works is if the lease company gets a low enough price on the car initially (using their bulk purchasing power), so that after depreciation and their profit margin you pay less than if you'd bought the car at list price and dealt with the depreciation.