Can I trade in instead of using cash for PCP deposit?

Fr Tod Umptious

We have a 161 7 seater Citroen that we have lost faith in.

The broken rear axle that has been replaced with a second hand one was the last straw.

Either I nor my wife are willing to spend the next few years praying that it doesn't happen again.

I'm looking at PCP for the peace of mind of having a new car,

But we don't have much cash for a deposit.

Could we use the current car as a trade in instead of a deposit?

We put a good few bob into the car in the last year, tyres, timing belt, battery etc so it's worth something.

Similar on DD are advertised for €8k+

JoeA3

You can of course. But brace yourself for low ball trade in offers.
Or you could try advertising it yourself on DD, should be decent demand for a 7 seater.

GPoint

you will likely get 3k offer for it going by what dealers want their margin to be these days.

Mad_Lad

https://www.boards.ie/discussion/2058412218/can-i-trade-in-instead-of-using-cash-for-pcp-deposit

If you haven't much cash for a deposit then it makes no sense getting into debt for a 30-40 K car just because you think you can afford the monthly payments doesn't mean you can afford the car because on PCP you are only paying the deposit + calculated depreciation + interest over the 3 years and x amount of Kms.

At the end of the contract you have to pay the balance on the loan to own the car and most likely have to refinance it at much higher interest. You can walk away and pay any additional mileage or you can hand it back via the half rule once you have half the loan paid back without any financial implications.

Don't be fooled by PCP, if you go on to your bank website and see how much a car loan is on the cost of the car you want to buy vs pcp , ask yourself, why is it so cheap on PCP ? the answer is to keep the monthly cost low so at the end of the pcp contract you will think to yourself "hmmmm, maybe I won't pay that 20K balloon payment , I'll get another new car for another 500-600 a month for another 3 years" and around and round you go , next you realise the amount of money absolutely wasted which would have been better off in an investment plan. Believe me, all those payments and deposits add up fast and you will not get anything near what you think you'll get 2nd hand for the car come trade in, in fact, there's a high chance you will have to come up with another deposit, from the 3 PCP I got I had no equity at the end.

The difference for bank loan can be as much as 1200 a month over 3 years vs 500-600 a month on PCP, this is why so many cars now are on PCP, 83.5% of all Volkswagens are financed on PCP. That was the case in 2023, I doubt much has changed.

All that money you can keep, drive the Citroen or change it for something much more affordable than a new car.

Let's be honest, and as someone who went with 3 x PCP I am trying to make you realise what PCP is all about rather than insult you but if you are hard strapped for the cash for a deposit what makes you think you're going to have the cost of the balloon payment at the end ?

The cost of cars is beyond a joke now and for good reason , people are buying new cars which are more expensive than the majority would have bought before PCP became available, so manufacturers copped on and made much more expensive cars and bigger and bigger and more and more expensive because they know all people care about is how much deposit and how much per month, the cost of the car is ignored.

As the cost of cars go up so does the tax bill to the Government, robbing shower will take a huge cost of the car in tax.

If people weren't buying them then the manufacturers would make sensible priced cars again.

And don't think that just because you have a new car that you won't be having to take trips to the dealer to sort issues under warranty. You may or may not but it does happen and it's a big inconvenience dealing with car dealers , they're nice as pie to you when buying new but don't want to know you after that and for warranty reasons you'll have to pay main dealer service prices to keep your warranty.

Mad_Lad

"We put a good few bob into the car in the last year, tyres, timing belt, battery etc so it's worth something."

It's part and parcel of car ownership, they are machines that need maintenance. Sometimes, if you are spending money maintaining a car then it's better to keep it, the Devil you know and all that.

The missus had to fork out for a new ECU for the Outlander diesel around 5 years ago maybe, cost something around 2000 Euro if I remember correctly, it was unfortunate, very, very rare I believe.

Last year she had to replace clutch slave cylinder which of course is in the gearbox so the subframe had to come out before the box and I asked them to throw in a new clutch while all that work was being done to save it being done again should the clutch fail, because at that time there was around 100,000 Miles on the clock, now it has 120,000 Miles. It's 10 years old.

My 1.0L T-GDi Kia Cee'd had to go in for timing chain and tensioner replacement this week, got it back today, 46,000 Kms on it but it started rattling around 26,000 Kms. Lucky it was replaced under warranty thanks to Kia's 7 year Warranty which I was clever enough to make sure the car had a full service record because they told me no service record, no warranty.

Cars cost money but nothing costs money like a brand new car !

Fr Tod Umptious

https://www.boards.ie/discussion/comment/123500770#Comment_123500770

That's a very good and informative post.

Thanks for taking the time to post it.

The reality is I'm not that keen on carrying too much personal debt myself.

I like to pay for things, and keep loan terms as short as possible.

But I'm just coming to the stage of asking myself "Am I not in debt enough" I have good credit and a good job, why not go PCP and and the end of the term just roll it over and continue on forever, and have a good reliable car for once.

But I totally get your point about the main dealer service expense with a new car.

No more just bringing it to reliable Joe down the road for a service and a few new tyres.

Another factor in this thinking is the shortage of 7 seaters out there.

There are a ton of Dacia Joggers (and I'm going to have a good hard look at a few in a couple of weeks, I'm not ruling them out as an option) but little else.

They stopped making the Citroen C4 in 2019, and th UK import market also vanished for obvious reasons.

So the thinking was if there is feck all out there why not go new PCP.

At the end of the day our concern about the second hand rear axle breaking will subside in time and in the meantime I'll keep an alert on DD for the very last of the C4s or good value Peugeot 5008s and might just go to the CU for a loan.

Or get a Jogger.

I test drove one a few months ago and I felt it was a bit cramped and restricted, for driver and passengers.

But it was a very very wet day and me and the family didn't get enough time to go through it in a bit more detail, getting in and out of the boot, trying different kids in different seats/rows etc, we were too busy trying not to get soaked wet.

Hopefully in a few weeks I'll get a better day and a bit more time to test one out.

Again, thanks for the advice.

You are dead right, the country is full of PCP cars.

Mad_Lad

https://www.boards.ie/discussion/comment/123501621#Comment_123501621

Thanks, as someone who got 3 PCP I think I am in a good position to advise others.

I suppose the real danger here is getting caught in the pcp loop, the idea that you can just keep going on new pcp contracts every 3 years but the realities are that you will need a deposit each time.

Getting new pcp every 3 years just to avoid the balloon is a bad idea because eventually it comes back to bite.

What I would do is look for a 2-3 year old car and finance with credit union or bank loan over 3-5 years and at the end you own it. Don't listen to BS from dealer sales people about the cheap monthly payments on PCP, if they keep rattling on about that then you know to walk away from PCP.

Remember that at this time car prices are seriously over inflated and you will regret all that wasted money after 2 or 3 PCP contracts, really, at the end of the day , a car is just a tool to get from A to B and you don't want to be working to pay for something that depreciates so heavily.

Think of it another way, why would anyone go out and get a loan and pay interest on a massive tax bill on a new car to the Government ? the tax alone on new cars is a huge turn off for me now, it really is a significant cost of a new car.

Your own words here ring alarm bells " But we don't have much cash for a deposit " Then think of it like this, what are you going to do come end of PCP with a potential 20,000 Euro Bill ? refinance at 8-10% interest ? that's mad. And if you want another new car on PCP again to avoid the balloon , lets for example say the car costs 40K then you will need 10% deposit minimum which is 4,000 Euro. So, if you have to sell your current car to come up with the cash for the minimum deposit you are depending on the car dealer to give you a decent price, remember that on PCP there is a pretty massive chance you will not have any cash or equity in the car to get another new car on PCP without putting 10% to the cost of the car in deposit.

My advice is keep the current car, save cash and invest in something that doesn't depreciate massively like a New car that includes a massive tax bill to the Government. The temptation is huge due to PCP but I wouldn't do it, you'll be glad in the end, no new car is cheaper or better than maintaining an older car.

BrianD3

Great post @Mad_Lad but the OP has lost faith in his Citroen and that is a feeling which is hard to shake off. It's easier if the owner has the skills/equipment to do repairs on the car himself but most people don't.

Plenty of indy garages have waiting lists of many weeks for servicing and repairs and some are not taking on new customers.

He could buy a used car but many fresh ones from dealers are not much cheaper than a new car - which as you say are now at ridiculous prices with no shortage of buyers. While many older cars are in sh*te and not even particularly cheap.

Mad_Lad

https://www.boards.ie/discussion/comment/123501708#Comment_123501708

2nd hand prices are insane, this is pure insanity https://www.donedeal.ie/cars-for-sale/hyundai-santa-fe-auto-awd/39764056?campaign=3

2016 santa Fe 2.2 diesel 230,000 Kms for 18,000 Euros, in my opinion it's 9,000 Euro over priced. That's mad, the 230,000 Kms doesn't bother me on a diesel , that's only 143,000 Miles.

I bet the add above when you go in to them it will be cash only and probably 20 K with trade in , I laugh at car dealers who advertise cash only and up the price with trade in. I simply don't deal with these people.

I wonder is it all down to Brexit ? car dealers just ripping people off big time, but there's several examples of that.

I paid 19,700 Euro for 2020 1.0L 120 Hp Kia Cee'd with 24,500 Kms last May and it had the timing Chain and tensioner done this week under warranty, it's now got 46,000 Kms. The Cee'd new is around 32K new so that was a saving of 10K or more. It's got another 2 years warranty left. I do really like the car, it's nice a way more comfortable than our Diesel Outlander which is still going after 10 years, ECU replaced around 5 years ago and slave cylinder and clutch last year, big enough job in the Outlander, the missus even contemplated changing it and I said for what ? because it needs some money put into it ? 120,000 Miles now it should go another 10 years.

My only Gripe with all the junk screens and software in cars now is will spare parts be available ? what happens if one of the computers fail or screen in 10 years ? will you pay an arm and a leg ? see, I don't mind spending money on repairing the mechanical bits of cars because they are what makes the car work which is important but paying out for crappy junk software, TFT screens, computers and the likes is something we don't actually need to have to put up with. This is why I always try now to get the most basic simple honest to God cars with manual AC and all that. Not interested in the shyte.

The cheapest new Jogger is 26,600 Euros, quite a good price by comparison, I know a lot of people look down their noses at Dacia but as I said, I'm more for value for money now and practicality rather than badge and big TFT screens which are not essential, a car to me is to get from A to B.

What car gave the Jogger a decent review but unfairly mention it's very poor safety rating from NCAP but failed to mention that NCAP did not actually test the Jogger at all and gave it a rating based on the old Logan which seemingly it's chassis is based on something like that but this is really bad of NCAP and jogger doesn't have all the nonsense software that bings and bongs at you if you as much as fart in a car now which knocked some points off it's score.

Here's a Jogger in Carlow for 18,550 Euro https://www.donedeal.ie/cars-for-sale/dacia-jogger-tce-110-comfort-7-seats/38852180?campaign=3

That's a fair chunk off what would have been a decent priced new car and a much more sensible amount to pay for a car these days.

I just spotted this jogger in Cork with only 51,000 Kms for 18,790 https://www.donedeal.ie/cars-for-sale/dacia-jogger-tce-110-comfort/38968687?campaign=3

Anyway, what I would suggest to the OP is whatever car he gets, if he needs to finance it go with bank loan or HP and not PCP, then at the end of 3-5 years he will own the car and not have to worry about a big cash payment or worse, refinancing at high interest, the cheap monthly payments on PCP come at a high price in the end. If he thinks the repayments are too high on HP then there's no sensible argument to go on PCP.

BrianD3

https://www.boards.ie/discussion/comment/123502096#Comment_123502096

The insane car prices will be due to supply and demand factors, we are living in an age of debt fuelled and decadent consumerism with car purchases a clear sign of this. The boom is getting boomier and people have lost the run of themselves. Cars and houses, people consuming and being "inspired" by Dermot Bannon and Hugh Wallace property porn on RTE.

Loads of money sloshing about, plenty of highly paid people working in multinationals, six figure salaries in their 20s and 30s yet don't know their arse from their elbow. They cream themselves over the latest smartphones and cars and their screens are just a natural progression from that.

They will pay through the nose, roll over PCPs and adopt the adage that the more you pay for something, the better it must be. We can see on this forum the sneers anytime Dacia is mentioned "I'd rather walk" "just take public transport".

I think the Covid PUP and similar payments in other countries has something to do with these attitudes in society. Not the payments themselves (which were generous) but the message they sent to people who were already borderline irresponsible with their money

Mad_Lad

https://www.boards.ie/discussion/comment/123502292#Comment_123502292

I don't know if many multinationals are paying six figure salaries to your regular employee ? usually only the managers that do f1ck all are paid decent but many don't even pay managers that unless you're pretty high up the chain.

There's a huge influx of Non E.U foreigners keeping wages lower than they should be in pharma and other multinationals in Ireland at present and has been the case for a while. If you're an electrician in a multinational for the likes of Microsoft in their Data Centres you'll be making 30-40 K more than the I.T folk, you'd probably make more than the manager of the I.T ops. Nice having trade unions you see. I.T isn't a recognised trade and never will be to please the multinationals and conditions in I.T for example can be quite appalling often with recruitment agencies employing people to contract them out in the Multinationals taking up to 40% of their salary.

The only ones making real money in Ireland are self employed trades people. And those on the upper management in Multinationals.

I can see the Dermot Bannon influenced houses around the country, mental. The amount of people taking out so called green loans to make their homes more energy efficient and install heat pumps is astonishing but they'll tell you they get a grant, but they have to spend big money to get this grant, people are insane with spending money in Ireland and most of it is now loans.

I understand the screens in cars designed by younger and younger people who are addicted to screens and feel everyone should have a screen in their faces all day and while they drive too. It's mental.