PCP to get better price, then cancelling

ThumbRemote

Apologies if this has been asked previously, I have tried to search old posts but couldn't seem to find a clear answer. 

I'm looking at buying a new car and have the cash saved up to pay for it outright. However the manufacturer/dealer is offering a discount to purchase it via PCP. 

Can I buy the car using PCP to get the manufacturer discount, then cancel the PCP within the 14-day cooling off period and simply pay off the finance company?

Grumpy_chap

Yes, there are some here that have done just that.  They may see this and add any pertinent advice on procedure.

shiraz99

ThumbRemote said:

Apologies if this has been asked previously, I have tried to search old posts but couldn't seem to find a clear answer. 

I'm looking at buying a new car and have the cash saved up to pay for it outright. However the manufacturer/dealer is offering a discount to purchase it via PCP. 

Can I buy the car using PCP to get the manufacturer discount, then cancel the PCP within the 14-day cooling off period and simply pay off the finance company?

Yes you can, it's a very common practice. Just make sure you read all paperwork carefully.

marlot

Yes, I've done it a couple of times.

I've been offered 1.9%APR on my next PCP, so I'm going to keep the PCP to term - I can invest the money for at least 3% return.

lordmountararat

Yes - I did this. The gorgeous sales woman did ask me to wait a couple of months before paying it off (would she have lost commission?), but if she had asked me to walk with bare feet over hot coals I would probably have done it.

Goudy

You can cancel the PCP arrangement within 14 days but you may lose some of the benefits of the deal, so read the contract.

Also the dealership will often lose their kickback from the finance company.
You might not think this is a big deal but you're likely to have to deal with them for the forseeable future while you own the car, so it might be wise to treat them fairly.

Otherwise you can settle the finance early at any time after that, the interest will be adjusted and the max interest they can charge is two months.

I've done this myself a few times.
I have had a few cars now on PCP deals via different NHS discount schemes.
The manufacturers deposit contributions on these schemes have been very healthy, £4000 plus in most cases but the interest rate tends to be slightly higher so they can (hopefully) claw this back.

I wait until I have made my first payment then ask for a settlement figure and clear it off.
I'm happy with that and the dealers happy they sold a car and got the kick back from the finance company.

Dogbyte009

Yes, I've done that. Check the T&Cs though as you often need to make the first few payments before you can pay it off in full.

marlot

Dogbyte009 said:

Yes, I've done that. Check the T&Cs though as you often need to make the first few payments before you can pay it off in full.

You have a legal right to withdraw from/setlle the finance in the first 14 days.

MX5huggy

Further to this can you pay off random chunks through the deal? 

shiraz99

MX5huggy said:

Further to this can you pay off random chunks through the deal? 

Yes, in most cases you can make overpayments but whether it makes sense to do so is a different matter.

YorkshireTraveller

I've done this twice.  As someone suggested above I agreed with the salesman to pay the first three months installments so that they would not lose their commisssion.  Worked out well for both of us.