Car loan help

illmonkey

We're looking at getting a new car, we've been presented with some finance options.

Anyone shed any light if its worth the select?

At the end of select, you can either pay the balance and walk away with the car or hand the car back.

We can also take a loan out with AA which comes in slightly cheaper than the HP here. But the sales guys given it "our way is better as it free's up your finance channels etc"



Thanks in advance!

mkbean

Don't you double a flat rate to get an APR? Your AA loan must be less than 12% APR?

I just weighed the PCP or HP choice up myself and found i could own the whole car in 4 years for a similar payment to "not owning" it in 3 years, just as your numbers say.

I chose to buy the car over 4 years.

Daniel.

P.S. check you can't get the car cheaper from an internet broker, follow Martins "Buying a new car" guide if you didn't already.

illmonkey

Thanks, I just looked. And as you say, the AA rate is 6.9% APR. but the total amount repayable on the HP is only £300 over 4 years.

This is AA in comparision.



SO, how can the APR for the select be double but the intrest charge is only £300 more over the whole term!

Im tempted to push for the select one as it can be turned around in a few hours and we need the car, but i want to make sure im not getting shafted!

mkbean

You'd be paying almost £1000 more for the car with the "Select" PCP plan over 36 months vs the HP over 48 months, and the AA saves you another 300.

Thats roughly £30 a month you can do something else with.

illmonkey

Thanks for thr advise.

We went for the AA loan. Made sense really.