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

MEM62

Grumpy_chap said:

I assume, if your parents are looking at a £60k car, they are reasonably comfortably off.

I would say that they must be very comfortable.  The value of the car will depreciate by over 50% in four years.  Therefore they are looking at £30k in depreciation plus another, by the OP's calculation, £7,700 in finance costs.  Without any other running costs taken into consideration that vehicle will cost the OP's parents £9,425 per year over the first four years of ownership.  Anyone with that amount of cash to spend on a car is more than comfortably off.  
The real question is why anyone with that kind of financial resources is looking for PCP or finance in the first place?  They should be a cash buyer.  
Edit:  Oops!  Point already made by @macman

bailey_uk

MEM62 said:

Grumpy_chap said:

I assume, if your parents are looking at a £60k car, they are reasonably comfortably off.

I would say that they must be very comfortable.  The value of the car will depreciate by over 50% in four years.  Therefore they are looking at £30k in depreciation plus another, by the OP's calculation, £7,700 in finance costs.  Without any other running costs taken into consideration that vehicle will cost the OP's parents £9,425 per year over the first four years of ownership.  Anyone with that amount of cash to spend on a car is more than comfortably off.  
The real question is why anyone with that kind of financial resources is looking for PCP or finance in the first place?  They should be a cash buyer.  
Edit:  Oops!  Point already made by @macman

A bit more background info, it is a 4x4 vehicle used 5 days a week family business and leisure both days at the the weekend. Not just sat on a drive doing nothing.
To take 45k out of the business (15 part ex) wouldn't be ideal but yes would save the 7700 interest

macman

If part of the capital cost can be set against tax as a legitimate business expense, then that puts an entirely different complexion on it.

bailey_uk

macman said:

If part of the capital cost can be set against tax as a legitimate business expense, then that puts an entirely different complexion on it.

Absolutely, appreciate your concern 

Herzlos

MEM62 said:

The real question is why anyone with that kind of financial resources is looking for PCP or finance in the first place?  They should be a cash buyer. 

not necessarily - it'd be foolish to pay for the car in cash if a PCP worked out cheaper; you could get a stronger ROI from the money being used elsewhere.

sourcrates

bailey_uk said:

MEM62 said:

A bit more background info, it is a 4x4 vehicle used 5 days a week family business and leisure both days at the the weekend. Not just sat on a drive doing nothing.
To take 45k out of the business (15 part ex) wouldn't be ideal but yes would save the 7700 interest

Got to be a Range Rover then, possibly in white ?

DrEskimo

Herzlos said:

MEM62 said:

The real question is why anyone with that kind of financial resources is looking for PCP or finance in the first place?  They should be a cash buyer. 

not necessarily - it'd be foolish to pay for the car in cash if a PCP worked out cheaper; you could get a stronger ROI from the money being used elsewhere.

Why use car finance to leverage an investment....settle the PCP to get the cheaper cost, sure, but then if you want to leverage an investment with borrowed money then borrow more on your mortgage or take out a personal loan.

Of course that wouldn't be my advice as I would never borrow to invest, but if you wanted I imagine there are many other cheaper ways to borrow given the typical interest charges with a PCP.

ratechaser

sourcrates said:

bailey_uk said:

MEM62 said:

A bit more background info, it is a 4x4 vehicle used 5 days a week family business and leisure both days at the the weekend. Not just sat on a drive doing nothing.
To take 45k out of the business (15 part ex) wouldn't be ideal but yes would save the 7700 interest

Got to be a Range Rover then, possibly in white ?

Only if the OP is in Essex 

could be a high spec X5 or Q7. Do XC90s go that high or Cayenne's that low? Plenty of posh Chelsea tractor fodder around that price point.

(I've only got a little Disco, so I know my place...)