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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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bazz26

I'd say it's more to do with what stock dealers can get their hands on before the end of March deadline. There is apparently production delays on petrol models.

mickdw

The figures for that golf appear worse than a highline Passat. What is the price on that car with options?
Are Highline golfs up on 34k now? Nuts really.

bazz26

Terms and conditions say they start at 30k for a 3dr 1.6 TDi before delivery and metallic paint or ticking any options so a 5dr with a few extras for 34k on the road is plausible.

DaveyDave

My Highline was €31,100 @ 0%. I don't know about the time of year effecting discount but I got close to €2k off my car and the 3 year service plan thrown in which I believe is around €500. If yours is €34k I'd push for a little more.

McGrath5

mickdw wrote: »

The figures for that golf appear worse than a highline Passat. What is the price on that car with options?
Are Highline golfs up on 34k now? Nuts really.

I'm going with an auto version and a few more extras, so 34k is easily attainable on these.

mickdw

That explains it.

ctlsleh

anyone any experience with Audi PCP and how negotiable they are etc?

looking at the A3 auto for my missus, i know that they will have a new model next year, so might get a good deal........is there any downside in that approach?

CIP4

ctlsleh wrote: »

anyone any experience with Audi PCP and how negotiable they are etc?

looking at the A3 auto for my missus, i know that they will have a new model next year, so might get a good deal........is there any downside in that approach?

Arent a few of them Audi Dealers doing 1.9% apr finance thats probably as low as you well get interest wise from Audi. Its just down to price. Having Bought an A4 recently of an Audi dealer they were willing to haggle a good bit and I got down the price a couple of thousand but generally they start low with trade in prices etc.

frogstar

Hi, looking to finalise a PCP deal with KIA

They are recommending the extras Gardx/RTI (return to invoice) insurance and Smart insurance (re scratches)

I'm unsure if these are necessities or something they just try to sell. Roughly 1500 for all (500each), that's for the 3 years

Any thoughts on pros / cons, is it a no brainer?

Thanks

vintagevrs

I wouldn't take any of them.

frogstar

vintagevrs wrote: »

I wouldn't take any of them.

Thats what we think too but are we leaving ourselves open to expenses if something happens?

sillysocks

frogstar wrote: »

Hi, looking to finalise a PCP deal with KIA

They are recommending the extras Gardx/RTI (return to invoice) insurance and Smart insurance (re scratches)

I'm unsure if these are necessities or something they just try to sell. Roughly 1500 for all (500each), that's for the 3 years

Any thoughts on pros / cons, is it a no brainer?

Thanks

When we got PCP I asked similar on here-we’ll just for the RTI insurance. I think ours is only about 12 eur a month so not too bad, and the general opinion then was that I should take it. I’m not sure I’d go with scratch insurance etc but for full write off it might be worth it.

mickdw

Return to invoice is possibly worthwhile but anything else wouldn't be for me.

digiman

DaveyDave wrote: »

My Highline was €31,100 @ 0%. I don't know about the time of year effecting discount but I got close to €2k off my car and the 3 year service plan thrown in which I believe is around €500. If yours is €34k I'd push for a little more.

Frank Keane Liffey Valley have a promotion this week where there is €2k off a petrol golf and €4K off the Passat. Tempted as the wife’s car could do with an upgrade.

carsfan2

digiman wrote: »

Frank Keane Liffey Valley have a promotion this week where there is €2k off a petrol golf and €4K off the Passat. Tempted as the wife’s car could do with an upgrade.

Trying to hit first quarter targets probably so might be good time for a deal.

bazz26

I'd imagine they are cars in stock.

CorkFenian

Reading through the thread here have a 2009 focus, (not hugely into cars)

Looking at getting a used 2012\2013 VW Passat just wondering about PCP etc

Is PCP worth it or should I just use credit union, i know its a general query

Should i be looking at 1.6\2.0 petrol\diesel

Thanks

Cyrus

CorkFenian wrote: »

Reading through the thread here have a 2009 focus, (not hugely into cars)

Looking at getting a used 2012\2013 VW Passat just wondering about PCP etc

Is PCP worth it or should I just use credit union, i know its a general query

Should i be looking at 1.6\2.0 petrol\diesel

Thanks

It’s not that common on used cars and even less so on ones more than a year old

bazz26

CorkFenian wrote: »

Reading through the thread here have a 2009 focus, (not hugely into cars)

Looking at getting a used 2012\2013 VW Passat just wondering about PCP etc

Is PCP worth it or should I just use credit union, i know its a general query

Should i be looking at 1.6\2.0 petrol\diesel

Thanks

A 2012/2013 car is too old for PCP. The whole premise around PCP is to get you into a brand new car through a structured payment method and repeat every 3 years.

CorkFenian

Thanks for confirming that from the ads i was thinking the same

Will have to look for the loan,

bazz26

Check out regular hp finance from dealers too, their rates can be more competitive than your own bank or credit union
.

digiman

If you are buying from an independent dealer rather than a main dealer is there a way to get PCP?

Or is my only option to go with a bank loan?

mickdw

A lot of independent dealers can arrange pcp now but any I've seen are charging 6 or 7 percent and to be honest on a pcp that is crazy expensive and the figures generally make no sense.

Becks610

Looking at 1.0 tsi Skoda Octavia 115bhp. Garage said best pcp is when you only put in 10-15% deposit. Dubious about this I am as it’s just a way for them to convince you at the end of the term that you can keep repayments the same and have new car.

Price 23380. Deposit 25% at 5845. Gmfv 8995 monthly payment 265 2.9% apr.

Deal- good, bad or meh.

elbyrneo

Becks610 wrote: »

Looking at 1.0 tsi Skoda Octavia 115bhp. Garage said best pcp is when you only put in 10-15% deposit. Dubious about this I am as it’s just a way for them to convince you at the end of the term that you can keep repayments the same and have new car.

Price 23380. Deposit 25% at 5845. Gmfv 8995 monthly payment 265 2.9% apr.

Deal- good, bad or meh.

Put the most you can into the deposit. Interest will be less and it's the only thing you can control other than bargaining down the overall price.

Dealer likely assumes 3year trade in value will give less equity over GFMV than the 5845 deposit you are suggesting now, so monthlys would go up and you might then go elsewhere. But if you know and expect that, save a little extra to top up the deposit in 3 years time to bring down the monthlys. Better to save and put aside now and avoid interest you need to pay.

If it's a good deal depends simply on APR and your expectation of equity over the GFMV.

Lantus

Becks610 wrote:

Price 23380. Deposit 25% at 5845. Gmfv 8995 monthly payment 265 2.9% apr.

The lower deposit tends to be the most sustainable solution long term, especially if you intend to roll into another deal. If you can afford the higher monthlys then you are financially stable at that level.

That is because the equity is likely only going to be 10 to 15% and currently they are under severe pressure for some brands. So the 2nd deal will be as if you put in a 10% deposit irrespective. This can come as a shock to those who failed to understand.

It's eyes open all the way.....

Yes you can save the difference if you make the higher deposit and yes the interest will be slightly lower with a higher deposit. Get a quote to see by how much do you can compare.

If your going to buy the car and your trade in is 6k as above then a higher deposit can be more beneficial. Again saving extra over the 3 years is beneficial to address the gmfv and limit any loan interest for the 9k you are due to pay on the outstanding.

If you can't easily save another 100 to 200 in addition to the 265 monthly quoted above then it's a very tight deal financially. Question affordability.

If you can you can pay off 7k after the 3 years and nearly buy the car.

Equity is the big issue after 3 years. It's dealer controlled and not very transparent from a consumer perspective. Especially where car values and deposits shift and change, dealer can control the narrative. Expect to have to invest more to get the same though.

conzy

Just a quick update that may help some people in future. I bought a new Ibiza Cupra in July 2016 on 0% finance PCP. It was a really affordable option and definitely the most power / spec / comfort possible for €24k I really enjoyed the car and the repayments were about the same as my fuel bill when I had an RX8...
I left to go travelling in January and had to sell the car privately.
The process of ending the PCP deal is extremely simple. Rather than having to deal in a substantial amount of cash. The buyer can pay VW Bank directly. They do not care once they receive the money. You can put the car reg or the agreement number as the reference. The difference is refunded to your bank account. e.g if you owe 14 and you sell for 16 then VW Bank will refund you 2.
After about a week a letter arrives saying the car is clear of finance and that should be it. I was surprised at how painless it was to sell a car that is on PCP privately. Hope that helps somebody

ShadowHearth

conzy wrote: »

Just a quick update that may help some people in future. I bought a new Ibiza Cupra in July 2016 on 0% finance PCP. It was a really affordable option and definitely the most power / spec / comfort possible for €24k I really enjoyed the car and the repayments were about the same as my fuel bill when I had an RX8...
I left to go travelling in January and had to sell the car privately.
The process of ending the PCP deal is extremely simple. Rather than having to deal in a substantial amount of cash. The buyer can pay VW Bank directly. They do not care once they receive the money. You can put the car reg or the agreement number as the reference. The difference is refunded to your bank account. e.g if you owe 14 and you sell for 16 then VW Bank will refund you 2.
After about a week a letter arrives saying the car is clear of finance and that should be it. I was surprised at how painless it was to sell a car that is on PCP privately. Hope that helps somebody

That was the reason I went with Ibiza Cupra too.

Fantastic package for the price.

Thank you for that informative post. Hopefully it will bust one of the myths going around that you cant sell pcp car before fully paying it off. Buying with bank loan at 9% apr and owning a car so you can sell it whenever is a very week argument.

sillysocks

Do the finance companies who have given the PCP usually offer the option of refinancing the gmfv amount at the end of the agreement if you want to keep the car but don’t have the lump sum?

raxy

sillysocks wrote: »

Do the finance companies who have given the PCP usually offer the option of refinancing the gmfv amount at the end of the agreement if you want to keep the car but don’t have the lump sum?

Yes. Once the pcp is up you can either return the keys, trade in for a new car, pay the gfmv or re-finance the gfmv payment.
It will more than likely be a higher interest rate though so probably better to get a loan elsewhere to pay it off.
I've a few months left on mine & plan on using savings & top up with a bank loan to pay it off.