Car purchase methods

[The Squirrel]

Of course PCP is cheaper in terms of monthly payment. You’re not actually building equity within the car, just paying the cost of depreciation.

Your end position is that you own zero value of the car - want a car at the end and you have to buy one full cost (even for the one you’ve been paying for for years), while the end point of a loan is that you own 100% of any value the car has - you have a car, your car, to keep for as long as you wish.

Anyone saying PCP is “cheaper” just because they've compared it to a loan and concluded that the monthly payments are lower is proof that PCP is working in it’s designed role: obfuscating the fact that you never own a car and are never moving towards owning one despite the monthly payments - makes it seem like you’ve bought and own a car but in reality you own nothing.

You’re trapped on the dealer payment treadmill forever - just like they want.

I go back to my statement on financial product complexity…

 

[Reemul]

The wife and I normally buy a 2 or 3 year old low mileage car and keep them for 10 years, we borrow for 4 years and thhn have 6 years of no payments. We are in our 50's and have always done this. Never own expensive cars, My wife and I have had a few Ford's and a few Peugeots. In that time we have had 1 stinker of a car the rest have been fine, nothing major re repairs either.

Paying £300 or £400 a month plus putting down £4k+ every 3 years to own something that spends 22 hours a day sat outside in no way feels like any sort of deal or bargain.

Currently I have a Ford Focus 13 plate 80,000 miles and it's not far off needing replacing due to general wear and tear.

Also we don't look after our cars liek they are thr crown jewels, they are crammed with multiple golf clubs, fishing gear, beach stuff, sand all summer long, kids stuff and so on, they get dinged, dirty and worn. They are just a useful tool and certainly not a status symbol of any sort

 

[Orikoru]

Of course PCP is cheaper in terms of monthly payment. You’re not actually building equity within the car, just paying the cost of depreciation.

Your end position is that you own zero value of the car - want a car at the end and you have to buy one full cost (even for the one you’ve been paying for for years), while the end point of a loan is that you own 100% of any value the car has - you have a car, your car, to keep for as long as you wish.

Anyone saying PCP is “cheaper” just because they've compared it to a loan and concluded that the monthly payments are lower is proof that PCP is working in it’s designed role: obfuscating the fact that you never own a car and are never moving towards owning one despite the monthly payments - makes it seem like you’ve bought and own a car but in reality you own nothing.

You’re trapped on the dealer payment treadmill forever - just like they want.

I go back to my statement on financial product complexity…

The way my wife has gone through cars we're better off not owning one. Every single one has been towed to the scrapheap when she's finished with it.

 

[PNWokingham]

bought a new car a new way on Friday evening - very unplanned - was in the pub and started up bidding on a 15y old BMW 840 convertibe on Piston Heads auctions!! Picked it up yesterday from Rugby and very happy as looks in better condition and provenance than i expected. Now got to decide who remaps it!

 

[Taz]

bought a new car a new way on Friday evening - very unplanned - was in the pub and started up bidding on a 15y old BMW 840 convertibe on Piston Heads auctions!! Picked it up yesterday from Rugby and very happy as looks in better condition and provenance than i expected. Now got to decide who remaps it!

is the remap to make it more economical given the current crisis

 

[larmen]

I don’t get PCP either. The argument is that ‘you only pay for depreciation’, but if the 1st few years are the hardest one on that. Then you are only ever getting the bad bits of a contract?

 

[KenL]

I don’t get PCP either. The argument is that ‘you only pay for depreciation’, but if the 1st few years are the hardest one on that. Then you are only ever getting the bad bits of a contract?

PCP can have some advantages in that you can have quite a bit of equity left at the end of (or part way through) the deal.

It can also offer protection against negative equity. I had an Audi A3 on pcp. It was worth about £2000 less than to cost to buy it at the end of the deal. So, in theory, the pcp actually saved me money as the amount I had paid was less than the depreciation.

 

[GreiginFife]

bought a new car a new way on Friday evening - very unplanned - was in the pub and started up bidding on a 15y old BMW 840 convertibe on Piston Heads auctions!! Picked it up yesterday from Rugby and very happy as looks in better condition and provenance than i expected. Now got to decide who remaps it!

840 at 15 years old? Surely that’s a 6er considering the 8 went out of production in 1999 until 2018.

 

[Bunkermagnet]

I don’t get PCP either. The argument is that ‘you only pay for depreciation’, but if the 1st few years are the hardest one on that. Then you are only ever getting the bad bits of a contract?

Buying a car via a PCP has been cheaper (total cost) than straight HP for the last 3 cars I have bought.
If you're lucky enough to have the whole amount, rather than pay it out in one go, to buy the car via a zero %PCP and put the remainder of the monies in an interest paying account would mean you would have more than you started when you come to the final balloon payment....so you have made money

 

[SwingsitlikeHogan]

Our most recent purchase was cash plus 0% manufacturer loan. Always been some form of PCP or whatever in the past, But as we intend to keep this one for a-long-time we weren't bothered about depreciation and resale value.