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PCP finance.

[Deleted User]

Ok so after a while of my brother and I trying to figure out the benefits of PCP we can't find any.

He's looking at getting a new Audi and we've been looking into pcp, he changes every 2 years or so and might have 15 k miles maximum on the clock so we thought pcp might suit him better.

You got to come up with a large deposit if you don't have a trade in and while your monthly payments appear low when you add in the fact you need a new deposit for the new pcp after 3 years your 300 a month pcp suddenly turns into 600+ pm.

So what's the benefit over hp or bank loan ?

The only hing with hp or loan is you pay the full interest where as pcp yup don't ?

Either way I see little benefit on a normal loan and trade in and re finance after 3 years or so. Only thing is VW bank has much lower interest than any other bank or finance.

For me doing 20-25 k miles a year pcp would leave me with not much on the gfv.

It seems to me that people could get caught out at the end because you can be damn sure you won't have much over the gfv to use as a deposit.

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Jobs OXO

Klopp wrote: »

Hi Guys, looking for advice and opinions. I have a 161 on finance over three years and i am currently just into my second year. The value of the car on trade in is roughly worth €21,000. I am looking to downsize and get a worth between €11,000 to €12,000. I know a dealer won't probably want to deal and i am probably wasting my time.

Any opinions from anyone in a similar situation?

What make and model?

Klopp

Jobs OXO wrote: »

What make and model?

That might help, It is a KIA Sportage

bazz26

How much do you still owe on the car?

cml387

You need to look for any termination rights you have in your PCP agreement.

But it's likely to cost you a lot to get out of the contract.

Klopp

bazz26 wrote: »

How much do you still owe on the car?

I don't know the the exact figure but it's at least €17,000. I can't see any dealer wanting to do a deal, there looking to make profit, it would probably cost me more trying to get out of my finance agreement early.

cml387

Klopp wrote: »

I don't know the the exact figure but it's at least €17,000. I can't see any dealer wanting to do a deal, there looking to make profit, it would probably cost me more trying to get out of my finance agreement early.

There's no question of any dealer because the car is not yours to sell. You have to deal with the finance company.

Masala

Quick question.... is the PCP mileage limit 20,000 or 25,000 Kms per year??

Anyone any idea of Skoda limits???

Lantus

cml387 wrote:

There's no question of any dealer because the car is not yours to sell. You have to deal with the finance company.

You can go to any other dealer to sell the car. They will clear the finance in the selling process.

Lantus

Masala wrote:

Quick question.... is the PCP mileage limit 20,000 or 25,000 Kms per year??

Masala wrote:

Anyone any idea of Skoda limits???

You can specify your annual mileage when you buy the car. There is no effective limit unless your mileage is going to be very high but it can be specific to each manufacturer so check. On my Skoda they weren't that bothered I'd be be doing 25k + a year. It makes very little difference to a cars value and the limits are there really to prevent fleet buyers availing of low interest rates and racking up huge miles on these PCP deals and then trading in.

Jobs OXO

Lantus wrote: »

You can go to any other dealer to sell the car. They will clear the finance in the selling process.

Yeah and give you a fraction of the diff !

Masala

Lantus wrote: »

You can specify your annual mileage when you buy the car. There is no effective limit unless your mileage is going to be very high but it can be specific to each manufacturer so check. On my Skoda they weren't that bothered I'd be be doing 25k + a year. It makes very little difference to a cars value and the limits are there really to prevent fleet buyers availing of low interest rates and racking up huge miles on these PCP deals and then trading in.

Many thanks... but I read that they hit you at the end for excess mileage at the end of the contract. 10cent a mile is €1000 for extra 10,000 miles. I suppose no bother if u buying car outright But could be reflected on the GV if u trading in

joebloggs32

Masala wrote: »

Many thanks... but I read that they hit you at the end for excess mileage at the end of the contract. 10cent a mile is €1000 for extra 10,000 miles. I suppose no bother if u buying car outright But could be reflected on the GV if u trading in

That charge would really only kick in if you handed back the car and were not upgrading, or if there was no equity above the GMFV on an upgrade.

draiochtanois

This post has been deleted.

Masala

OSI wrote: »

This is only charged in the event you hand back the car at the end of the finance period instead of paying the final payment or trading the car in.

Thats not too bad then.....would be bonkers to just hand back car!!

Lantus

Jobs OXO wrote:

Yeah and give you a fraction of the diff !

Another dealer may actually give a better to get you to switch to their brand. The stumbler may be that the paid offâ€‹ term is quite short. Depreciation is greater in the first year so unless the deposit was high the outstanding sum may be close to the trade in value. Only way to know for sure is to ring a few up and ask them what they would give you.

ECO_Mental

Lantus wrote: »

You can specify your annual mileage when you buy the car. There is no effective limit unless your mileage is going to be very high but it can be specific to each manufacturer so check. On my Skoda they weren't that bothered I'd be be doing 25k + a year. It makes very little difference to a cars value and the limits are there really to prevent fleet buyers availing of low interest rates and racking up huge miles on these PCP deals and then trading in.

I don't know really I'm 2.5 years into a pcp, Passat highline and when I was signing on they said to me yeah don't worry so I'm at 57k now so would be looking at 70k in Jan when renewing so I said i would just enquire to see should I trade now before the 60k.

Anyway I'm am paying 445 pm now and to get the same car again I would have to pay 530.. that's nearly a 20% increase! To keep at my current rate I would have to pay 3000 extra.!

A bit pissed off. Now the highline estate has gone up a grand or two to just over 40k I paid around 38k back in 2015. But I was under the impression and it was said to me that if I were to go again then there would be negiotions and don't woŕry.! But I am now

mickdw

To be honest, adding 3k to get into another car of slightly higher value is as good as could be expected, certainly considering the additional mileage.

ShadowHearth

mickdw wrote: »

To be honest, adding 3k to get into another car of slightly higher value is as good as could be expected, certainly considering the additional mileage.

Thats what I was thinking too. Putting down 3k and keeping same repayments sounds like good deal on a new version of a car, which is more expensive.

_Brian

If I'm doing 40k km's a year is there any pcp out there for me ??

youcancallmeal

_Brian wrote: »

If I'm doing 40k km's a year is there any pcp out there for me ??

You can get a PCP no problem you will just have to plan to pay the balloon payment and keep the car at the end of 3 years.

ELM327

youcancallmeal wrote: »

You can get a PCP no problem you will just have to plan to pay the balloon payment and keep the car at the end of 3 years.

Werent Skoda doing a high mileage PCP recently? For something like 50k km.

Klopp

draiochtanois wrote: »

This post has been deleted.

I am looking to downsize and own a car outright. I am just not sure if any car dealer will want to to deal when the car i have is worth more than what i want.

EndaHonesty

_Brian wrote: »

If I'm doing 40k km's a year is there any pcp out there for me ??

I'm doing 40k per year and I'm on a PCP.

My plan is to pay the balloon payment at the end of the term...

ShadowHearth

EndaHonesty wrote: »

_Brian wrote: »

If I'm doing 40k km's a year is there any pcp out there for me ??

I'm doing 40k per year and I'm on a PCP.

My plan is to pay the balloon payment at the end of the term...

I do about 30k km per year and thats my plan too. If there is new cupra and they willing to do a good deal I moght think about whole trade in, but if they will just try to shaft me, ill just throw money on a table and drive away happily.

Pcp is still way better way of buying a car then hp if you doing high miles. Lower apr or zero apr and scrapage. Plus you stil get options in the end of 3 years. Win win.

EndaHonesty

ShadowHearth wrote: »

I do about 30k km per year and thats my plan too. If there is new cupra and they willing to do a good deal I moght think about whole trade in, but if they will just try to shaft me, ill just throw money on a table and drive away happily.

Pcp is still way better way of buying a car then hp if you doing high miles. Lower apr or zero apr and scrapage. Plus you stil get options in the end of 3 years. Win win.

I took the 0% PCP as it's a no-brainer.
My plan was always to buy the car at the end of the term but I'm curious to see what the procedure will be at that time.

I would be open to a Superb Combi Sportline or a Kodiak Sportline (if it was available then) but it would be down to how attractive a deal they could offer.

Lantus

ECO_Mental wrote:

Anyway I'm am paying 445 pm now and to get the same car again I would have to pay 530.. that's nearly a 20% increase! To keep at my current rate I would have to pay 3000 extra.!

Mrs lantus had 83k on her car upon return. Wasn't even mentioned. Car inflation and your initial deposit will have the biggest effect on monthlys

As we keep saying a 12 to 15% deposit provides the best long term stability against any increases in your monthly payments. But price increases cannot be readily protected against.

Maybe look at downsizing to a jetta or an octavia.?

EndaHonesty

Lantus wrote: »

As we keep saying a 12 to 15% deposit provides the best long term stability against any increases in your monthly payments. But price increases cannot be readily protected against.

The size of the deposit doesn't change anything except the monthly cost. The GMFV (balloon payment) is always the same.

Lantus

EndaHonesty wrote:

The size of the deposit doesn't change anything except the monthly cost. The GMFV (balloon payment) is always the same.

It will affect your monthly payment if you move into another 3 year deal. A very high deposit giving you the lowest monthlys will result in the highest increase in monthlys for the next 3 year deal all things being equal. This is because the gmfv remains a fixed point as you state irrespective of your journey to get there.

EndaHonesty

Lantus wrote: »

It will affect your monthly payment if you move into another 3 year deal. A very high deposit giving you the lowest monthlys will result in the highest increase in monthlys for the next 3 year deal all things being equal. This is because the gmfv remains a fixed point as you state irrespective of your journey to get there.

Lots of words but you're wrong. The GMFV is constant so you will have the same equity in the car no matter the deposit or monthly payments...

Assuming you're on a low rate the difference between a lage deposit and low monthlys and the opposite is minimal.

Another person who doesn't understand PCP.

jca

EndaHonesty wrote: »

Lots of words but you're wrong. The GMFV is constant so you will have the same equity in the car no matter the deposit or monthly payments...

Another person who doesn't understand PCP.

He isn't wrong, what he meant was that if you start your first PCP deal with a good trade in(high deposit) which will give you nice low manageable monthly payments you won't have that nice high deposit next time around and the monthly payments will be higher.