How did you finance your new Tesla?

icylava

I wonder how Tesla owners finance their Model 3 / Model Y? I have to say they have terrible finance options for Irish consumers. (For people who do not need finance options to buy a car, please ignore my post. )

For example, the Model Y is a few thousands cheaper than BMW iX3, yet their monthly payment is a hefty 1k a month on their hire purchase option with a down payment of 23k. With a similar deposit, the monthly payment for iX3 dips down to 600-ish on PCP. The fact that the significantly less monthly payment had me stay away from Tesla twice.

I feel I am fortunate to be able to afford BMW EVs, but is it that I am still not wealthy enough to buy a Tesla, or do you have better finance options or do you just live with it?

...Ghost...

Wha?

wotzgoingon

Easy I just didn't buy one.

podge1979

https://www.boards.ie/discussion/2058259694/how-did-you-finance-your-new-tesla

Hi its kinda like comparing apples an bananas there. Hire purchase and PCP.

Hire purchase has no balloon lump sum payment option at then end of 3 years so that is why it dearer, you own the car. You don't own the car on PCP without the lump sum payment.

So to afford a Model Y you would do similar to what your doing on your IX3, its possible to arrange a PCP type approach with some financial institutes or do a lease which is pretty much like PCP as some leases give an option to buy at the end of the lease period or hand it back with all the jazz on milage reasonable condition, fully service history etc.

I did a PCP on my last car would never do one again as depending on the market can get stung if you do big milage. It's good now but who knows what it will be like in 3 years time also GMFV seems to be pretty low on PCP's on EV's.

I did it on a 30k Audi A3 years ago with GMFV around 18k. From what I see GMFV on 60k ev's at the mo is around the mid 20s? Which seems low.

Thumper Long

https://www.boards.ie/discussion/2058259694/how-did-you-finance-your-new-tesla

Finance Ireland provide PCP options and work closely with Tesla so they tie in with you account etc, I used them this time and the process was extremely easy, was all online and from enquiry online to application to approval was less than a business day. PCP vs HP depends on the buyer’s circumstances, very high mileage users can be penalised on PCP but only against the rates agreed in the contract so it’s hardly a scam.

I am going onto my 4th PCP previous 3 were with VWFS and at change time the car was always worth more than the GMFV and never required additional cash from me to go again. I usually change every 3 years but bought out the PCP on my soon to be last car as there wasn’t anything available that really interested me and I was still deciding on ICE vs EV. In fairness I have always exceeded the mileage allowed on PCP and never had an issue or been charged for the overage, the conversation with the garage was always I’m interested in X car how much will you give me for my own and then if happy with the cost to change went ahead. Each time I changed dealer so it wasn’t dealer specific. The balloon payment isn’t an issue, I usually put the difference between HP and PCP aside so I have options at change time. The relatively low GMFV is there to protect the lender so that at all times there is equity in the car.

TLDR do what suits you or what you can afford and on a monthly basis, it’s pretty much cast in stone that your EV will be worth more than the balloon and with current shortages etc in 3 years time.

ted1

https://www.boards.ie/discussion/comment/119500098#Comment_119500098

The GMFV is just the minimum value.

...Ghost...

PCP payments will always be lower than HP payments over the same period of time, because the balloon payment remains at the end of the PCP term which is designed to hook consumers into perpetual finance payments. Fine if you want to change your car every 3 years on PCP, otherwise you need to either put aside the difference over the finance period, or take out finance to cover the balloon payment....or give the car back.

Tesla offer PCP with First Ireland at the same rate as their HP deals with FI and AIB.

HP payments on a model 3 over 5 years will be 8-900 per month depending on the deposit amount paid and assuming the SEAI grant was availed of. I reckon most people put down 10k and the SEAI grant adds 5k to that, so the payments would be circa 850pm. PCP payments will be lower, around the 600 range, but all you're doing is delaying a final payment which could be painful, or be more or less forced into using the vehicle as a deposit for another contract.

innrain

I think it is a measure of market size and financial instruments available to a less established player. Change the Tesla shop over to DE and you'll find PCP for 533/month with 5k deposit and 26k balloon payment. Increase the deposit to 15k and the monthly drops to 300 quid. I see Santander and Tesla Financial Services as lenders. Santander, I think left Ireland during the recession and Tesla FS is not here probably as it is not making sense yet. Aib not interested in PCP so you have to find yourself a lender as others did. If you check on the Model 3 thread you will find the details. It is more hassle than walking into a dealer and getting all things sorted then and there you're right. Personal decision. For me it is about the total cost and not how much I pay per month.

podge1979

https://www.boards.ie/discussion/comment/119500644#Comment_119500644

Yes I'm well awear of that, my point being guarantee 5 years ago on a 30k car was 18k. On a 60k car now its 25k. Probably get more but with recession clouds on the horizon might not be so good. Finance companies will use PCP firstly for their own benefit and pass on the benefits of a strong market to customers. Equally if the market is bad who takes the hit?

I'm not warning against PCP's but the reason they are cheaper is there is more risk on the consumers sign it's not free money. People don't really like anyone speaking any bad of PCP's on boards 🤣

ted1

I don’t think you quite understand how it works.

The 25k is what is left in the car for you to pay.

you’ve 3 options

1.) pay it and own the car

2.) walk away

3.) trade it in , shouid be worth more than 25k, say 35k. And that’s a 10k deposit.

here mine: ( i’m actually paying less as I got a better rate)

ID.4 City

Cost                                      €35,300.00

Scrappage                  € 3,000.00

Deposit                               €10,000.00

Finance Amount              €22,300.00

GFV                                      €16,860.00

36 Monthly Payments   €     243.17

MojoMaker

An ID4 for 35K?

Thumper Long

https://www.boards.ie/discussion/comment/119502635#Comment_119502635

Aye I think it was 39k list less SEAI grant + dealer charges, them were the days pre war and covid before the world went fcukîng mad

ted1

https://www.boards.ie/discussion/comment/119502635#Comment_119502635

32k + a 2006 VW Touran with 280k on the clock and a replaced engine 😅😅 that I bought of my brother for 700 a year or 2 earlier.

the 52kWh model with a real range of about 300km

but my point was just showing what VW charge for PCP and what the GFV is

TheW1zard

I lease mine through my company. Technically costs nothing

ELM327

PCP

mc2022B2TF

Oh how we long for the days of 0% finance. Last car i had was on 0% PCP and it was simply the best deal ever. GFMV was so low at the end compared to the trade in value of the car.

Up until March this year you could get a leaf on 0% too. Thats gone now though.

...Ghost...

https://www.boards.ie/discussion/comment/119503485#Comment_119503485

Yeah I cancelled my Leaf at 0%. I couldn’t get it

ELM327

0% finance is generally only available for run out models, or undesirable specs, or overstock etc

In a time where demand greatly exceeds supply, 0% finance is not going to happen. Finance (leverage) isnt free, so "0% finance" is actually the OEM paying for the cost to get you to buy their car.

mc2022B2TF

https://www.boards.ie/discussion/comment/119504125#Comment_119504125

True enough but sometimes it can work in your favor - for example my last car was being facelifted the following year so they went 0% for the last six months of the year before. I was more than happy to do that and it didn't affect the trade in value. In fact the trade in value after 3 years was 82% of the original cost price.

In fairness the leaf on 0% was a great deal but as demand suddenly rocketed they removed it as it did not make sense for them to continue to give it away for free!

...Ghost...

The 0% is the main reason I placed an order for a Leaf. The next reason was that it was affordable (partly due to the finance deal) and the final reason was delivery was for July when I had ordered in March.

I was told the 0% would hold, but delivery date was moved to October at the earliest and the sale price was not guaranteed. In the end, I had to cancel and ordered the car I really wanted. Was very pleasantly surprised when the estimated delivery date was only a few weeks away.

...Ghost...

That’s the one I ordered. Well, that one was actually promised to a guy in hospital. Waiting for deposit return now.

ELM327

That leaf looks like it is in a museum, which is where any "new" car with chademo belongs.

...Ghost...

https://www.boards.ie/discussion/comment/119504717#Comment_119504717

😂😂

Is probably have only used the public network a half dozen times per year, so CHAdeMO wasn’t an issue. The range was also more than adequate for my needs and it’s a lot nicer than the Gen 1.5 I have.

However, as you say, I made the right choice and I know it. Besides, I can’t say online what the dealer offered me regarding the Leaf in the picture above. I was left with my jaw on the ground.

icylava

Ah, looks like there is a possibility of getting PCP on Tesla! Thanks a million for sharing!

For me, the monthly payment needs to be as low as possible even if it means saving up for the max deposit for the next car, thus PCP suits me.

Thumper Long

https://www.boards.ie/discussion/comment/119563116#Comment_119563116

Finance Ireland extremely easy to deal with with a max deposit on the model 3 the monthly is approx €515

Killer K

@icylava @thumper@Thumper Long did you both end up getting your Tesla's on PCP?

Very little online, even on finance Ireland of PCP rates for model 3.

Jog501

4 year pcp quote I got was:

Price €52,972

Deposit €10,000

48 x €658

GMFV €18,551

Zurbaran

https://www.boards.ie/discussion/comment/119842888#Comment_119842888

3 years makes way more sense.

Killer K

https://www.boards.ie/discussion/comment/119842888#Comment_119842888

Thanks Jog501. Who did you get the quote from?

Jog501

https://www.boards.ie/discussion/comment/119843022#Comment_119843022

I just emailed the sales team and they got back to me in about a week or so. There's a 3 year option too but it didn't make sense for my circumstances. They're more flexible than most manufacturers in that regard.

Thumper Long

https://www.boards.ie/discussion/comment/119842724#Comment_119842724

I did take one on PCP at 4.95%

Killer K

Sound, thanks again Jog501. Annoying they don't give that option online. Will email them.

Jog501

There's a 6 year HP option too @4.95% if you want to keep your capital commitment low and utilise it elsewhere.

mickdw

People should consider also that like for like interest rates on HP and PCP will work out more expensive on pcp as a big lump of the borrowed money is being slung out to the end of the term before being repaid

Pcp really needs super low interest to be attractive.

Zurbaran

I did pcp with them. Would have preferred a lower rate but meh.

Im not sure why they don’t have the pcp on the website, it’s been available for a good while now.

Jog501

https://www.boards.ie/discussion/comment/119843115#Comment_119843115

Simply not true. You pay the interest on the amount you borrow, not the total price of the car. You can pay off the ballon, hand the car back, sell it yourself or trade it in for a newer model at the end of the term. You can pay the balloon off at the end with your own cash so total interest paid is a lot less than HP or refinance a portion of it, again in this case you've paid less interest than with HP as long your refinance rate isn't much worse than the HP rate offered. PCP also gives you guaranteed protection against depreciation.

3DataModem

https://www.boards.ie/discussion/comment/119843154#Comment_119843154

I think the point he's making is that for a given interest rate, you will pay more euros in interest for PCP than you will on HP, because you are paying the HP balance off a lot faster. This is objectively true.

celtic_oz

https://www.youtube.com/watch?v=m3n-W6x96J4

explained well here

ELM327

https://www.boards.ie/discussion/comment/119843154#Comment_119843154

Plus the Tesla financed PCP has a very very conservative GFMV meaning that you will in all likelihood have a positive equity built up to trade in in 3 years. They even support this in Finance Ireland as they have a different process for trading in and taking a new PCP/HP with finance ireland

oinkely

Would love one, but don't have the cash for one and don't take loans for cars. So leaf it is for the foreseeable. I'll be happy with a lift in my friends one, which is probably financed through a loan of some sort.

MojoMaker

Step into the 1990s while you're at it and throw away that auld post office book 😀

oinkely

https://www.boards.ie/discussion/comment/119848533#Comment_119848533

Funny, was just discussing this with someone in work, and they laughed at the idea of not buying things with money you don't have. They couldn't believe that I had never had a car loan. I guess I've been lucky enough to be able to afford an average (or maybe below average) car from my own money without too much difficulty and having a fancier one wasn't high enough of a priority to pay the interest on a loan to get a better one. Not sure where I got this from but I've never done it (apart from the house) and might be in the minority but just think it's not for me.

And my last engagement with the post office was many many years ago.

I guess the economy needs people to keep borrowing to buy shiny new things but I'd rather not have any additional financial yokes around my neck. The mortgage is enough of a burden ;-) I figure if I can't afford it then a loan / finance etc is just making it seem more affordable but in reality it's still out of my financial league. So I'll do without.

Anyway, dragging this way OT, sorry OP.

Each to their own, and if finance makes sense to you to get your butt into a fancy leather fart on demand seat with almost autonomous driving and ludicrous acceleration for a standard production car then go for it. I genuinely hope it brings you great joy.

Anyway, back to the 80s with me and my finance free cars.

mickdw

https://www.boards.ie/discussion/comment/119843154#Comment_119843154

It is completely true.

You pay interest on the amount you borrow. The amount you borrow includes the large balloon amount which has been financed day one to actually pay the manufacturer for the car and then just offset to the end of the loan.

Alot of people think the balloon is not borrowed at all but it absolutely is.

All the options you mention are available but in each case, it involves paying off the outstanding borrowed money whether by paying out cash or simply giving back the car to cover the outstanding borrowings.

I am 100 percent correct stating that any given rate like for like hp v PCP will result in more interest being paid on a PCP.

Do the figures!

Zero percent PCP works very well for vw for example as offsetting a big lump of the cost towards end of term in that case doesn't cost anything in interest.

Your post reminds me of an Audi salesman who produced a crap PCP deal to me and when I got back to him stating it added up to a mental rate of about 11 percent, he said, sir, the figures are quite complex and you wouldn't be able to calculate the interest without our dealer calculator. I got an apology an hour later for the error in the figures.

Jog501

https://www.boards.ie/discussion/comment/119850795#Comment_119850795

To reiterate, you only pay interest on the borrowed amount not the total amount. Handing back the car, trading it in or paying cash to pay the balloon incur no interest cost.

If you save and invest the difference between the monthly repayments (HP vs PCP) you could effectively have a good potion of the balloon ready to go anyway at the end of the term while also having the safety net of that cash during that term. The interest savings are stark if you do anything but borrow the whole amount of the balloon which someone on PCP would rarely ever do anyway and would be a terrible decision. All that said, as someone mentioned above the best option for anyone would be to put their money to work and not throw it on a depreciating asset like a car!

mickdw

https://www.boards.ie/discussion/comment/119851073#Comment_119851073

Are you trying to say you don't pay interest on the balloon amount over the initial 3 year period?

Rusky rusky

https://www.boards.ie/discussion/comment/119851375#Comment_119851375

People don’t understand that you borrow the full price of the car less the “deposit”. The interest is calculated upfront on the full borrowed sum and hidden in the monthly payment. Monthly payment only covers smth like 40% of the borrow sum (max 30% deposit, min 30% balloon. ID plan for ID.3s had GMFV of 50% = no equity in the car free 3 years). Ballon payment generates a fair bit of interest as it’s borrowed for all 3 years. How the car dealers calculate the PCP interest I don’t know as I was never really been able to match it using online calculators. People just look at the monthly sum and overlook the total interest charged. On PCP it could be eye an watering sum and could be bigger than an HP on a much higher interest rate.

mickdw

I've my own excel calculator than matches the various manufacturer figures by simply calculating the interest once monthly, add it to outstanding, reduce by monthly payment and repeat 36 times.

Starting with full price less deposit and ending after 36 payments with an amount equal to the gfv remaining.

It's simple straight loan with a bulk of it unpaid until month 36.

rx8

That sounds way too complicated.... I think I'll just pay cash 💲 💵.

unkel

@oinkely - you are not alone. I would never take out a loan / finance for a car. This has meant for considerable periods in my life that I was driving bangers. In more recent times, things have looked up and some of my cars have been more valuable. Including the new Tesla I ordered last month. But I still drive around in my second car sometimes too, which is an old 90s clapped out BMW with over 400k km on it

rodneytrotter15

Can the car be paid for early or is it all due in one lump sum just prior to collection ?

Mad_maxx

im buying with cash , took money out of post office as earning 1% , useless in inflationary times