PCP finance.

jca

badgerhowlin wrote: »

What you think.

Is PCP for me.

Looking to get VM touran 34K
Deposit of 7k(trade in and own money)
Annual mileage is about 20k but might be up to 10k higher a year.
MFV is said to be 11804
Monthly repayments 452
APR 0%

But at the end of the 3 years we will be keeping the car.

Your mileage could scupper the deal in 3 years time but then again if your intention is to keep it will you still be able to get 0% finance on the final loan?

badgerhowlin

No you go into a normal HP finance agreement or so I understand. Just started to look there the weekend so not sure what is want yet!

GavMan

badgerhowlin wrote: »

What you think.

Is PCP for me.

Looking to get VM touran 34K
Deposit of 7k(trade in and own money)
Annual mileage is about 20k but might be up to 10k higher a year.
MFV is said to be 11804
Monthly repayments 452
APR 0%

But at the end of the 3 years we will be keeping the car.

Discuss it with a dealer.

See what affect that mileage might have on the GMFV and maybe check out what 3 year old Tourans with say 60-80k Kms are selling for. Car might still be worth more than the GMFV even with the higher mileage.

HP might be a better product for your mileage and that you want to keep the car beyond 3 years

moleyv

There are new model tourans out/coming out too so that would be a factor to consider for value after three years.

It would be better to have the new model unless there is a big discount on old model.

Bigcheeze

moleyv wrote: »

It would be better to have the new model unless there is a big discount on old model.

Might explain the 0% finance

badgerhowlin

Just talked to a different VM sales man. I liked him. He didnt try and sell me a car because he didnt have one.
Told me that the new one will be ready to order In November BUT it wont be 0% APR they only doing that with the current one is to get them sold. Most likely the APR on the new one would be 3.9% but he couldnt say.

As for the extra KM's
He told me that I could drive 200k a year and it wouldn't matter as long as I didnt walk away for the car at the end of the year. Then the penalty will incure. I asked him what the cost was and he was very slow in answering but said 8c per 100KM.

If I was to look to upgrade my car at the end of the 3 years. it would bring down the value of the car.

L-M

The 8 cent only comes in to effect if you hand back the car at the end of year 3. If you were stuck you could just sell it privately for more and clear the loan with the balance.

0% PCP is really a no brainer. The same loan on anything like 5-9% APR you're talking a couple of thousand in interest.

Just beware that there are very few (if any) Touran left.

The mileage penalty with be 8 C per KM not per 100 Km.

PCP or HP, bank loan makes no difference at the end of the day if you intend to keep the car what you need to do is find out the total cost to buy V bank loan, HP etc.

If you get 0 % interest on PCP doesn't mean you get 0% on the Hp at the end or however you pay off the balloon, perhaps a 1-2 year old car would be best if you want to keep it ?

badgerhowlin

Guess the lad in VM lied to me about the penalty! I know it was too good to be true...

You will never get 0% interest on you balloon repayment. because you are doing a finance deal so you will have to go with the finance APR rate.

PCP V HP does make a difference. Especially when you get 0% finance for 3 years. and then finance for 2
years.

My example 3 years 0% interest + 2 years of 7.9%(BOI motor loan) give total repayments at 29k
you would need your HP rate to be at 2.9% to match.

Granted if you went with a 141 with 20k KM on it, it would work out a 4 grand cheaper but you have a almost 2 year old car
131 would be 6grand cheaper for almost 3 year old car

Casati

jca wrote: »

Your mileage could scupper the deal in 3 years time but then again if your intention is to keep it will you still be able to get 0% finance on the final loan?

I hope your getting a discount off the rrp of the car too? If the list is 34k, then you should be trying to get 3k off that as a discount (or else make sure that 3k extra is built into the trade-in value)

If I saw a 2012 Touran, with less than 100km on it, that cost 34k new, on the market now for less than 18k I'd jump at this- these cars hold their value very well, especially any non imported VAG serviced car. Im sure as well as the % apr increasing the new model will be a lot more expensive and wont come with the same kit that the outgoing cars see as standard

L-M

badgerhowlin wrote: »

Guess the lad in VM lied to me about the penalty! I know it was too good to be true...

You will never get 0% interest on you balloon repayment. because you are doing a finance deal so you will have to go with the finance APR rate.

PCP V HP does make a difference. Especially when you get 0% finance for 3 years. and then finance for 2
years.

My example 3 years 0% interest + 2 years of 7.9%(BOI motor loan) give total repayments at 29k
you would need your HP rate to be at 2.9% to match.

Granted if you went with a 141 with 20k KM on it, it would work out a 4 grand cheaper but you have a almost 2 year old car
131 would be 6grand cheaper for almost 3 year old car

Work out the interest doing PCP on a 131 at 6.9%, you will soon fill the gap between that and the new one.

Casati wrote: »

I hope your getting a discount off the rrp of the car too? If the list is 34k, then you should be trying to get 3k off that as a discount (or else make sure that 3k extra is built into the trade-in value)

That's not how business works I'm afraid.

sheff the ref

Without proper calculations, going PCP for the first 3 years nearly sounds the best job because the car is still only 3 years old by the time the interest repayments start under a different finance.

Buy a 2 year old car and it is 5 years old after 3 years and there might not be a massive amount in the difference when interest and all is paid

Limerick man wrote: »

Work out the interest doing PCP on a 131 at 6.9%, you will soon fill the gap between that and the new one.



That's not how business works I'm afraid.

If you do low mileage then PCP is a no brainer only if you intend to get a new car in 3 years because your monthly payments will be much lower than a bank loan or HP.

PCP also gives you the 3 years to think whether you want to keep the car, chances are you'll find yourself getting a new lease rather than pay a lump sum or refinance a 3 year old car, but PCP gives you the option or 3 years to think about it.

testicle

Anyone happen to know if you're allowed to change car during the initial 3 year period? If so, how?

mickdw

testicle wrote: »

Anyone happen to know if you're allowed to change car during the initial 3 year period? If so, how?

Ya you could but realistically you will be costing yourself money.
They would value the car the day you wish to change it and check total settlement figure to buy out car and go from there.

You can change but in reality your current car has depreciated + cost to change.

I was thinking about this for the 2016 30 Kwh leaf, the larger battery would be handy but it's costs 3 K extra + what the car has lost over 21 K since January. So that's going to be 6-8 K Euro's.

I would rather wait until 2018 when the first of the 150-250 Mile range affordable electric cars start to appear. That's when my lease ends. So at the end I know exactly the minimum value I get for the car and hopefully will have more than the GFMV at the end.

If I were to go way over my mileage limit then at that point it could be worth it to change to a new contract.

Say if it was going to cost 2-3 K extra in mileage penalties then I'd rather put that into a new car, the garage may write some of it off to get your business again then again he may not.

Villain

So with PCP there are penalties for going over the mileage but what if you end up doing much less than you signed up for? e.g. if you signed up for 3 year PCP based on 20k per year but only end up doing 15k per year so at end of 3 years you are 15k less than expected, should the equity increase much? Anyone have experience of this?

MuppetCheck

If you're trading the car in it is bound to be worth a few quid more on a trade in - it depends on the car but you're going to be in a slightly better position. The amounts going to pale in comparison to the penalties for going over mind.

g0g

Hi all, have searched for threads on this subject and this one seems to be the most lengthy/informative so I thought I'd add here.

1) Where can I find a list of who (preferably someone who makes a 7-seater!) offers 0% interest on these deals? All I've found so far is Citroen.

2) Assuming no car to trade in, if you were to compare buying say a € 30K car up front with cash (if you had it) versus a 0% PCP deal on that same car, does the PCP always make more sense (assuming GMFV is accurate?) as it allows you earn interest in the meantime? Or will you always get a much better cash price than the PCP price? Or can a 0% PCP plan potentially include things like servicing?

3) I think it's been asked already on the thread, but have any boards users completed their initial 2/3 year period and if so how did they get on?

La Fenetre

g0g wrote: »

Hi all, have searched for threads on this subject and this one seems to be the most lengthy/informative so I thought I'd add here.

1) Where can I find a list of who (preferably someone who makes a 7-seater!) offers 0% interest on these deals? All I've found so far is Citroen.

2) Assuming no car to trade in, if you were to compare buying say a € 30K car up front with cash (if you had it) versus a 0% PCP deal on that same car, does the PCP always make more sense (assuming GMFV is accurate?) as it allows you earn interest in the meantime? Or will you always get a much better cash price than the PCP price? Or can a 0% PCP plan potentially include things like servicing?

3) I think it's been asked already on the thread, but have any boards users completed their initial 2/3 year period and if so how did they get on?

There's so many differing offers and methods of purchase etc. there's no handy hard and fast rules anymore.
You can only compare like with like.

1) Not that many offer 0% PCP. It varies from offer to offer, year to year.
Some only offer 0% on traditional HP, while charging APR on PCP's
Sometimes the "cash price" will be cheaper than the "0%" price, sometimes there will be no difference. Depends on many variables.

2) Again there are so many variables, one answer will never fit all circumstances. It depends on a combination of the dealer, the manufacturer, the model, the time of year, current offers and competitors offers going on. What you can do is compare like with like only, e.g. compare the Cash price and the Credit price of that exact make and model you're interested in, at that time, with one main dealer, and then go compare the Cash and Credit price on offer for that same make and model with another main dealer.

3) I haven't so can't comment, but I've never heard too anything negative yet. If they don't give you much above the GMV when you trade in again, you can always trade it in somewhere else and pay off the GMV.

I think they way the car market is at the minute, its drive bangernomics or drive new (and PCP is as good an option as any, depending on a persons circumstances), as there's very poor value in between, due to the lack of quantity of decent second hands on the market, and the high cost of sterling. From about 2008-2013, there was only about a third of the cars normally sold in previous years, so that makes the second hand market quite restrictive.

g0g

La Fenetre wrote: »

I think they way the car market is at the minute, its drive bangernomics or drive new (and PCP is as good an option as any, depending on a persons circumstances), as there's very poor value in between, due to the lack of quantity of decent second hands on the market, and the high cost of sterling. From about 2008-2013, there was only about a third of the cars normally sold in previous years, so that makes the second hand market quite restrictive.

Thanks for that, very interesting reply. My head is utterly melted. Have had company cars the past 12+ years so this is the first time I've had to actuially look at buying. My initial plan had been to go for a 2011-2012 model to have something in good nick but past the initial big period of depreciation. Is the general consensus in the market though as you say that you're as well off to go new?

La Fenetre

g0g wrote: »

Thanks for that, very interesting reply. My head is utterly melted. Have had company cars the past 12+ years so this is the first time I've had to actuially look at buying. My initial plan had been to go for a 2011-2012 model to have something in good nick but past the initial big period of depreciation. Is the general consensus in the market though as you say that you're as well off to go new?

Again it's hard to say, the PCP's have become very popular though, and they are not a bad option at all. Much longer new car warranties and all in servicing deals are also very attractive these days. Some people just prefer buying used no matter what, even if the used prices are a bit high these days and the selection is less. Once you've decided your ballpark budget, and the model you're after, you can then get down the fine detail of comparing like with like. Go for something reliable anyway, that's the most stress free option long term.

JIdontknow

Have many here gone for the PCP option?

Looking at a following approx breakdown scenario.

Car Value approx 24000, Opel Astra / Ford Focus or similar
6000 deposit (3000 cash deposit + 3000 scrappage).
4.9% APR
Based on Opel:
Monthly Payments approx €310 (Can range to probably 350 depending on spec)
GMFV Approx €8,600. (up to 9600 depending on spec)
2012/2013 currently going for approximately €13,000+

Based on these figures, I would have expended approx €23,000 (after paying the GMFV) which would be basically the RRP of the car.
I wouldn't trade up to new again, I would opt for the GMFV buyout after the 3 years as I hate being tied into loans and payments.

Is there something I am missing above, or anyone went the PCP way and like to explain / advise of their scenario and if it was positive / negative?

My alternative is to probably buy a 2011/2012 car on finance.

Approx €11000-12000 in value.
Pay a few grand as a deposit incl. scrappage of my current car (not even worth a grand, with NCT due in a few weeks, and looking at putting approx 400 into it just for 1 year NCT, tax also up)
Payments say €250 per month over 4 years.
So total expended would be approx 13000/14000, but at the end of this, the car is 7-8 years old.
I could probably get another few years out of it after this though.

I wouldn't be the most knowledgeable with loans, payments, apr, etc.

Decisions, Decisions!!

JIdontknow

JIdontknow wrote: »

Have many here gone for the PCP option?

Looking at a following approx breakdown scenario.

Car Value approx 24000, Opel Astra / Ford Focus or similar
6000 deposit (3000 cash deposit + 3000 scrappage).
4.9% APR
Based on Opel:
Monthly Payments approx €310 (Can range to probably 350 depending on spec)
GMFV Approx €8,600. (up to 9600 depending on spec)
2012/2013 currently going for approximately €13,000+

Based on these figures, I would have expended approx €23,000 (after paying the GMFV) which would be basically the RRP of the car.
I wouldn't trade up to new again, I would opt for the GMFV buyout after the 3 years as I hate being tied into loans and payments.

Is there something I am missing above, or anyone went the PCP way and like to explain / advise of their scenario and if it was positive / negative?

My alternative is to probably buy a 2011/2012 car on finance.

Approx €11000-12000 in value.
Pay a few grand as a deposit incl. scrappage of my current car (not even worth a grand, with NCT due in a few weeks, and looking at putting approx 400 into it just for 1 year NCT, tax also up)
Payments say €250 per month over 4 years.
So total expended would be approx 13000/14000, but at the end of this, the car is 7-8 years old.
I could probably get another few years out of it after this though.

I wouldn't be the most knowledgeable with loans, payments, apr, etc.

Decisions, Decisions!!

As far as I am aware you can get PCP on 2nd cars, not sure up to what year though but it could make monthly payments very low indeed and a very good alternative to traditional finance if you intend to change again in 3 years, it still gives you the option to buy after the 3 years if you want to keep it.

Always remember if you wish to buy the car there is the balloon at the end other than this I don't see any major negatives at the end unless you trash the car or go way over the mileage, then if this is the case just buy the car at the end.

dashcamdanny

I got PCP on my first new car in April. VW were very crafty only offering the low finance on the highline spec cars.

Im delighted with it to be honest. I got a great car out of it and i'm finally on the ladder to work my way up to a new GTI.

They gave me 3000k for a 15 year old Almera on a non scrappage trade in. That took about 3 hours of haggling though.

Final payment on 9k on a car that should be worth 15-16k if I keep it in good nick.

Opel would not entertain me with my trade in, Nissan had a waiting list of 3 months for a pulsar 9% interest.
Could not even get my hands on a Hyundai i30 at the time. Old stock was sold out.

Glad I walked into the VW for a noisy. Payments work out as much as I would have had paying back the bank for a 2 year old car.

nowayout1

Hey guys I'm after been pondering in getting a second hand mondeo 2009/2010 but after running a few figures over a loan through Permanent TSB's car loan and getting one through the credit union they were too expensive for a used car. But it looks like I'm going to go for a brand new car, went into a couple Ford dealers in Dublin getting roundabout figures on PCP on a Zetec Focus and one offered me a good deal at the time was €1k deposit cash plus my 2004 carisma for €4k and a monthly payment of €280 over 36 months.

But the new Jetta has caught my eye and planning to pop to the dealer after work tomorrow to get a deal. Yesterday went to a Ford dealer and had offered me €399 on PCP which was cheaper for me to get used car than a new one. VW are doing a deal order your 161 in January and get an upgrade pack for €161 worth €1500 if the numbers work out right and a bit of haggling it'd be mine. Anyone know of any good deals going?

dashcamdanny

Did you try Nissan or Hyundai? Even if it your not really interested, go and see what deal you can get, then go back to VW and Ford with the offers on paper. Good bargaining tool.

Its really important to consider the resale value after 3 years . There is no point saving 1000 to lose 1500 after the term of the loan is finished.

MarkN

Out of the brands mentioned NowWayOut - VW have the lowest rates so you will probably find the Jetta will be cheaper (assuming the models are similarly priced).

Bigcheeze

nowayout1 wrote: »

Zetec Focus and one offered me a good deal at the time was €1k deposit cash plus my 2004 carisma for €4k and a monthly payment of €280 over 36 months.

Are Ford not discounting the focus by 4k until 31 Jan so effectively he offered you Zero for the carisma ? http://www.ford.ie/Cars/Focus/Promotions#primaryTabs

jca

Skoda are still doing 0% pcp on all cars except the Superb. The superb is 3.9%