How did PCP work out in the end?

lalababa

EndaHonesty wrote: »

I'll have paid 41,260 for 2 cars over 6 years. Car 1: 4,000 deposit in 2015, 480 per month for 3 years (17,280) & Car 2: 555 per month for 3 years (19,980)

I won't keep the car. I'll change it for a new one in September 2021 and keep paying my monthlies...

I think the above about sums it all up....excuse the pun.

Bass Reeves

is_that_so wrote: »

It might be but consider a chat with the CU as well. They'll welcome borrowers as everyone is just saving!

Ya they have serious money on deposit. They have gone very competitive on larger borrowings over 10years. I believe that you can borrow over 50k unsecured for 4% with them.

ForestFire

Jacovs wrote: »

Not listed as 1 of the 3 options given by the bank.
Suppose you would have to apply for a personal loan as a separate agreement to the PCP.

It's more or less option 2, as the new finance will pay off the current PCP.
The only question is what new finance is available.

You can organise this yourself or the garage may have options, including with the same company/bank that done the PCP, it just won't be a PCP anymore (Not actually sure what it is?? HP, personel? is the car still used as security?).

Skoda offer me a 3.9% refinance option (With VW bank) at the end of my last PCP, but I went with the trade in anyway...

Some car dealers have agreement directly with the banks, where they do not own their own "Bank".

Water2626262

ForestFire wrote: »

It's more or less option 2, as the new finance will pay off the current PCP.
The only question is what new finance is available.

You can organise this yourself or the garage may have options, including with the same company/bank that done the PCP, it just won't be a PCP anymore (Not actually sure what it is?? HP, personel? is the car still used as security?).

Skoda offer me a 3.9% refinance option (With VW bank) at the end of my last PCP, but I went with the trade in anyway...

Some car dealers have agreement directly with the banks, where they do not own their own "Bank".

It’s standard HP.

DaveyDave

Something I wasn't aware of, at least with VW, you can get what I believe they call a bridge loan. At the end of your PCP, if you're ordering a new car you can extend your payments at the same rate for several months until the new car arrives. You just need to put an order deposit down.

My PCP is up on the 11th. A month ago while test driving the ID.3 I told the salesman I'm holding off for 6-9 months before getting a new car, he said he'll let the finance guy know and to expect a call. Heard nothing so I called them, they told me VWFS deal with it and transferred me, they said the dealer should be dealing with it but will arrange my plan. I should expect a call to give me the numbers for 1, 2 and 3 years refinance at 5.9%. Still didn't hear anything. It's funny because they've sent me 4 letters in the last 2 months telling me my options...

CoBo55

DaveyDave wrote: »

Something I wasn't aware of, at least with VW, you can get what I believe they call a bridge loan. At the end of your PCP, if you're ordering a new car you can extend your payments at the same rate for several months until the new car arrives. You just need to put an order deposit down.

My PCP is up on the 11th. A month ago while test driving the ID.3 I told the salesman I'm holding off for 6-9 months before getting a new car, he said he'll let the finance guy know and to expect a call. Heard nothing so I called them, they told me VWFS deal with it and transferred me, they said the dealer should be dealing with it but will arrange my plan. I should expect a call to give me the numbers for 1, 2 and 3 years refinance at 5.9%. Still didn't hear anything. It's funny because they've sent me 4 letters in the last 2 months telling me my options...

You'll need to act quickly or they'll attempt to take the balloon payment on the 11th clearing out your bank. Are you wanting to refinance the balloon and keep the car?

Lantus

Interested Observer wrote: »

I'm about halfway through my PCP on an Octavia. I think we'll just try and pay the balance at the end and keep the car. Does anyone know is it possible to buy an extended warranty at the end of a PCP deal if you keep the car?

You can I think. Ask your dealer for the options. Also if you service at dealer you get skoda select which is free break down recovery and hire car until yours is fixed. Just used it myself and its saved me a fortune, kept me on the road stress free.

Bass Reeves

CoBo55 wrote: »

You'll need to act quickly or they'll attempt to take the balloon payment on the 11th clearing out your bank. Are you wanting to refinance the balloon and keep the car?

The question is are we getting to a situation where the car is less valuable than the balloon payment. Are second hand cars beginning to sit in dealers forecourts. Sometimes dealers can become obessed with selling new and ignore the amount of secondhand product on the forecourt. There are a lot of full forecourts out there .

Lantus

There is no sign of that at all?? Prices would need to drop 20 to 30 pc for this to happen. Most new cars are going up in price. 2nd hand market demand is increasing if anything.

bazz26

Yes it's quite the opposite of what the doom merchants have been saying for ages now. Second hand cars are selling very well apparently with good stock in short supply. UK imports will probably dry up severally at the end of the year due to Brexit and new VRT rules making demand even higher for second hand cars here which will push prices up.

Water2626262

Bass Reeves wrote: »

The question is are we getting to a situation where the car is less valuable than the balloon payment. Are second hand cars beginning to sit in dealers forecourts. Sometimes dealers can become obessed with selling new and ignore the amount of secondhand product on the forecourt. There are a lot of full forecourts out there .

No evidence of that at all bar the odd BMW / VW examples where the GMFV was 50% or more. Don’t think they still offer this.

Markcheese

Was listening to something on bbc about new car sales dropping in the uk ( covid ,brexit, who knows?)
But second hand car prices rising. .. between that and brexit that'll take more uk cars out of our market , so the price of secondhands will probably rise more here too ...

Top Dog

Bass Reeves wrote: »

The question is are we getting to a situation where the car is less valuable than the balloon payment. Are second hand cars beginning to sit in dealers forecourts. Sometimes dealers can become obessed with selling new and ignore the amount of secondhand product on the forecourt. There are a lot of full forecourts out there .

I think part of it depends on the segment you're looking at. I've been watching the market for Mitsubishi Pajeros since June, and some dealers are still trying to sell particular vehicles for over 4 months.

I think the market for affordable to run mid sized family cars is still doing OK, but thirstier, more expensive to run vehicles are beginning to struggle a bit more.

GusGus

I have been in two dealers recently and both saying they don’t have quality 2nd hand cars as stocks are low .

GusGus

GusGus wrote: »

I have been in two dealers recently and both saying they don’t have quality 2nd hand cars as stocks are low .

What age range are you referring to?
less than one year old, one to two, two to three, older?

CoBo55

[Deleted User] wrote: »

What age range are you referring to?
less than one year old, one to two, two to three, older?

You'd rarely see anything older than 151 on a dealers forecourt. Nox tax and impending no deal Brexit has killed their auction fed cash cow.

DaveyDave

GusGus wrote: »

I have been in two dealers recently and both saying they don’t have quality 2nd hand cars as stocks are low .

My local VW was getting UK cars last year as they weren't getting as many trade-ins back, but presumably still selling second hand stuff. Their car park is still as full as usual so presumably still selling similar numbers.

markc1184

Quick question about PCP. We have a car that will be finishing its 3 year contract in March. When we took that out we were allowed to top up our trade in with cash to around 1/3 of the cost. If we decide to go for a different model but same brand this time around, with the trade in value being a good bit higher than the original trade in, can we or would it even be worthwhile adding cash this time around?

CoBo55

markc1184 wrote: »

Quick question about PCP. We have a car that will be finishing its 3 year contract in March. When we took that out we were allowed to top up our trade in with cash to around 1/3 of the cost. If we decide to go for a different model but same brand this time around, with the trade in value being a good bit higher than the original trade in, can we or would it even be worthwhile adding cash this time around?

Adding cash will reduce your monthly payments if that's what you want. Are you going to change your car? Who knows what things will be like next March, wait and see what the figures are.

Blowheads

markc1184 wrote: »

Quick question about PCP. We have a car that will be finishing its 3 year contract in March. When we took that out we were allowed to top up our trade in with cash to around 1/3 of the cost. If we decide to go for a different model but same brand this time around, with the trade in value being a good bit higher than the original trade in, can we or would it even be worthwhile adding cash this time around?

It is very unlikely the difference they allow you over the GMFV would be 30% the value of the new car and as such your monthly would go up.
Experience says you need between 2 and 7 grand, depending of course on the make & model.
So it depends if you want to put in cash at the trade in or pay higher monthly.
There is no way you could trade in and not pay cash and keep the monthly the same

mickdw

markc1184 wrote: »

Quick question about PCP. We have a car that will be finishing its 3 year contract in March. When we took that out we were allowed to top up our trade in with cash to around 1/3 of the cost. If we decide to go for a different model but same brand this time around, with the trade in value being a good bit higher than the original trade in, can we or would it even be worthwhile adding cash this time around?

How much value will you have in the trade in though. Remember much of the value of your trade in is still owed as part of your pcp.

Lantus

markc1184 wrote: »

Quick question about PCP. We have a car that will be finishing its 3 year contract in March. When we took that out we were allowed to top up our trade in with cash to around 1/3 of the cost. If we decide to go for a different model but same brand this time around, with the trade in value being a good bit higher than the original trade in, can we or would it even be worthwhile adding cash this time around?

So the bigger the deposit the smaller the monthlys but remember the gmfv is the same.

I always ask if the monthly payments are affordable with a moderate deposit about 15pc. If not then there is a possible affordability issue.

Yes you can top up any future deal with cash to a max of 30pc on pcp but you really need to ask why?

When you come to trade in your deposit is the difference between the final payment (gmfv) and what the dealer gives you for the car. So if you still owe 10k and the dealer offers 13k you have 3k to roll into the next deal as your deposit. Paying more up front won't change this final figure.

A zero pc deal makes a big difference in being able to lower your deposit and keep manageable monthlies.

ELM327

CoBo55 wrote: »

You'd rarely see anything older than 151 on a dealers forecourt. Nox tax and impending no deal Brexit has killed their auction fed cash cow.

Nox wont affect Euro 6 diesels as it is only a couple of quid.
It's the 4.5k nox on older stuff - which these dealers wouldnt stock anyway - thats a killer

Wildly Boaring

Lantus wrote: »

So the bigger the deposit the smaller the monthlys but remember the gmfv is the same.

I always ask if the monthly payments are affordable with a moderate deposit about 15pc. If not then there is a possible affordability issue.

Yes you can top up any future deal with cash to a max of 30pc on pcp but you really need to ask why?

When you come to trade in your deposit is the difference between the final payment (gmfv) and what the dealer gives you for the car. So if you still owe 10k and the dealer offers 13k you have 3k to roll into the next deal as your deposit. Paying more up front won't change this final figure.

A zero pc deal makes a big difference in being able to lower your deposit and keep manageable monthlies.

Sensible

Basically it's the interest rate that matters. 0% or as close as possible.

There are 3 parts. Deposit. Monthlys and GMFV
GMFV is the same.
Deposit and Monthlys add up to the same number once you have a low interest rate.
By upping the deposit, you lower the monthlys but you pay the same amount over the 3 years.
If the interest raet is high then it makes sense to increase the deposit. But it also makes more sense to shop around and even change cars to a different brand to get lower interest rate

hooch-85

Bit OT but does anyone know if it is possible to refinance from a HP agreement to regular loan with a lower interest rate? I.e. take out loan to clear the outstanding HP balance and repay loan as normal?

Mickiemcfist

hooch-85 wrote: »

Bit OT but does anyone know if it is possible to refinance from a HP agreement to regular loan with a lower interest rate? I.e. take out loan to clear the outstanding HP balance and repay loan as normal?

It depends contract to contract, in some there are early repayment penalties so you'll have to check your documents.

hooch-85

Mickiemcfist wrote: »

It depends contract to contract, in some there are early repayment penalties so you'll have to check your documents.

I did, and it details the half and one third rules but no mention of early repayment fees. Its an AIB HP if that makes any difference.

CoBo55

hooch-85 wrote: »

Bit OT but does anyone know if it is possible to refinance from a HP agreement to regular loan with a lower interest rate? I.e. take out loan to clear the outstanding HP balance and repay loan as normal?

I did that with Ulster Bank years ago and there was no problem. Are AIB on here?

hooch-85

CoBo55 wrote: »

I did that with Ulster Bank years ago and there was no problem. Are AIB on here?

Cool, so it can be done then. Just noticed that avantcard/an post are offering 5.9% on loans of €20k and over, I am currently locked into a HP with 4 years remaining. I would save over a grand in interest or €26 a month on my repayments if I could switch. Not massive numbers but every little helps as they say. I plan on keeping the car long term so have no interest trading in any time soon so thought this might be an option.

CoBo55

hooch-85 wrote: »

Cool, so it can be done then. Just noticed that avantcard/an post are offering 5.9% on loans of €20k and over, I am currently locked into a HP with 4 years remaining. I would save over a grand in interest or €26 a month on my repayments if I could switch. Not massive numbers but every little helps as they say. I plan on keeping the car long term so have no interest trading in any time soon so thought this might be an option.

I did it to streamline my finances after the financial crash of 08, I rolled everything into one loan (cu).