New Car

[Deleted member 1740]

I can’t get my head around these PCP deals. The thought of spending £320pcm + for a motor that I’ll never own unless I pay the massive balloon payment at the end puts me off.

 

[Deleted member 1740]

Just looked at the finance arrangements on an 11k bike from Triumph. 7.9% APR, you'll end up paying 50% more to own the bike via PCP than you will via HP. Or you can go to the bank and get the loan at about 3%. No contest.

When I was looking to buy a new van in March, I looked at financing it £12k van cost £15,300 HP and with a Santander loan for £10k I paid £10,780 back.

I also looked at leasing a van but it was £320pcm for 3yrs then either give it back or renew for a newer van. If after 3yrs I gave it back, I’d have paid nearly £12k for a van that I didn’t own. In the end I bought one cash.

 

[Blue in Munich]

When I was looking to buy a new van in March, I looked at financing it £12k van cost £15,300 HP and with a Santander loan for £10k I paid £10,780 back.

I also looked at leasing a van but it was £320pcm for 3yrs then either give it back or renew for a newer van. If after 3yrs I gave it back, I’d have paid nearly £12k for a van that I didn’t own. In the end I bought one cash.

I’m currently paying Santander back for the bike and might be going to them for a car if the current one misbehaves again.

 

[Deleted member 1740]

I’m currently paying Santander back for the bike and might be going to them for a car if the current one misbehaves again.

I couldn’t believe how much you paid back, I thought it was a typo. I wanted to keep my monthly outgoings to a minimum.

 

[Tashyboy]

Dont want to take this off topic, but do we not get shafted re price of cars in the UK. Went to Malaysia a year or so ago and malay cars nigh on zero tax. European cars 100% tax. Just seen a Mazda CX5 starts at 29,000 dollars in oz about 16-17K. Not a cat in hells chance of that happening in the UK. Whys that? I dont know. Tax? Greed,profit. Surely it would stimulate the economy and be better for the environment driving round in low fuel efficient vehicles (that you can fit clubs in)

 

[PJ87]

Just looked at the finance arrangements on an 11k bike from Triumph. 7.9% APR, you'll end up paying 50% more to own the bike via PCP than you will via HP. Or you can go to the bank and get the loan at about 3%. No contest.

Called shopping around.

Car wow discounts on finance normally wipe out the interest costs

They gave me 4k off my car for finance and worked out at 3k interest so saved 1k

My car before was 0%

 

[Bunkermagnet]

Dont want to take this off topic, but do we not get shafted re price of cars in the UK. Went to Malaysia a year or so ago and malay cars nigh on zero tax. European cars 100% tax. Just seen a Mazda CX5 starts at 29,000 dollars in oz about 16-17K. Not a cat in hells chance of that happening in the UK. Whys that? I dont know. Tax? Greed,profit. Surely it would stimulate the economy and be better for the environment driving round in low fuel efficient vehicles (that you can fit clubs in)

Perhaps you should look at it another way.....why do so many people buy the expensive German marques instead of the cheaper stuff thats just as capable of getting from A to B just as capable of carrying what we need, probably more reliable and cheaper to repair, and why don't we as a nation only buy what we build in this country?

 

[woofers]

Perhaps you should look at it another way.....why do so many people buy the expensive German marques instead of the cheaper stuff thats just as capable of getting from A to B just as capable of carrying what we need, probably more reliable and cheaper to repair, and why don't we as a nation only buy what we build in this country?

Or perhaps look at it as why do people 'need' to replace their cars so frequently ? Vanity ? It's certainly clever marketing to make you feel you need the latest model but with ever increasing congestion the performance characteristics are largely irrelevant. Modern cars don't rust as they did years ago, engines are quite capable of running a couple of hundred thousand miles, so it's generally safety features and fuel economy that are the major developments.

 

[BristolMike]

Or perhaps look at it as why do people 'need' to replace their cars so frequently ? Vanity ? It's certainly clever marketing to make you feel you need the latest model but with ever increasing congestion the performance characteristics are largely irrelevant. Modern cars don't rust as they did years ago, engines are quite capable of running a couple of hundred thousand miles, so it's generally safety features and fuel economy that are the major developments.

Quite a judgemental comment there. Why is someone enjoying something vanity?

 

[Deleted member 15344]

Dont want to take this off topic, but do we not get shafted re price of cars in the UK. Went to Malaysia a year or so ago and malay cars nigh on zero tax. European cars 100% tax. Just seen a Mazda CX5 starts at 29,000 dollars in oz about 16-17K. Not a cat in hells chance of that happening in the UK. Whys that? I dont know. Tax? Greed,profit. Surely it would stimulate the economy and be better for the environment driving round in low fuel efficient vehicles (that you can fit clubs in)

Plenty of cheaper cars on the market

And what is the average wage in Malaysia?

It’s a different economy, different lifestyle, there will be some things cheaper in Malaysia and Aus and no doubt some things cheaper in the UK - we are being “shafted” we all have a choice on what we want to buy , if people want high spec then pay for it

 

[Hacker Khan]

Perhaps you should look at it another way.....why do so many people buy the expensive German marques instead of the cheaper stuff thats just as capable of getting from A to B just as capable of carrying what we need, probably more reliable and cheaper to repair, and why don't we as a nation only buy what we build in this country?

Why do people buy Titliest and Mizuno instead of Slazenger when in the vat majority of cases the Slazenger will get the golf ball to much the same place?

 

[Hacker Khan]

Or perhaps look at it as why do people 'need' to replace their cars so frequently ? Vanity ? It's certainly clever marketing to make you feel you need the latest model but with ever increasing congestion the performance characteristics are largely irrelevant. Modern cars don't rust as they did years ago, engines are quite capable of running a couple of hundred thousand miles, so it's generally safety features and fuel economy that are the major developments.

I think the golf club manufactures are the best at this and make car companies look like amateurs. Plus safety and fuel economy are pretty important reasons to change for a lot of people.

 

[Mudball]

So here are some numbers that i look thru my deal.

1) allegedly my car costs about 28k (which i think is ridiculous for a hatchback - never mind the brand). It got shiny alloys and mettalic paint and some of the new tech that comes standard on a BMW.
2) I say allegedly because i think the number is made up. BTW, CarWoW provides a similar figure for it. However, due to various discounts this number magically comes down to something around 24k. So my finance is based on that
3) Deposit and monthly for 48 months add up 15k
4) Balloon payment (if i so choose) is about 12.5K
5) At the end of 4 years,
a) i can walk away or trade up after paying 15k
b) Get a 4 year, single owner vehicle that i have been driving around for 27.5k

The other key thing with PCP is affordability and access. If i went to a bank for a 25k loan for 4 years, then i will get have to pay about £500 pm. Plus all the usual bits of admin. I dont have a massive deposit to put away also i would need to make some sort of payment to get rid of existing motor. Despite all it Warts, the PCP is a great way to provide access to new wheels. Also helps the economy by keeping it moving. Remember, if you save and be extra cautious, it does not help the economy. the Economy works when people spend money on goods and services.. BUT spend responsibly

 

[BristolMike]

So here are some numbers that i look thru my deal.

1) allegedly my car costs about 28k (which i think is ridiculous for a hatchback - never mind the brand). It got shiny alloys and mettalic paint and some of the new tech that comes standard on a BMW.
2) I say allegedly because i think the number is made up. BTW, CarWoW provides a similar figure for it. However, due to various discounts this number magically comes down to something around 24k. So my finance is based on that
3) Deposit and monthly for 48 months add up 15k
4) Balloon payment (if i so choose) is about 12.5K
5) At the end of 4 years,
a) i can walk away or trade up after paying 15k
b) Get a 4 year, single owner vehicle that i have been driving around for 27.5k

The other key thing with PCP is affordability and access. If i went to a bank for a 25k loan for 4 years, then i will get have to pay about £500 pm. Plus all the usual bits of admin. I dont have a massive deposit to put away also i would need to make some sort of payment to get rid of existing motor. Despite all it Warts, the PCP is a great way to provide access to new wheels. Also helps the economy by keeping it moving. Remember, if you save and be extra cautious, it does not help the economy. the Economy works when people spend money on goods and services.. BUT spend responsibly

This is the point of it for me. Does PCP work for everyone, no. If your intention is to keep the car forever of course it wouldn’t work, but if you intend on changing cars on a relatively regular basis it makes perfect sense.

I could have paid for mine outright, but if you use the lump sum in a better way you can actually make a profit on the money to pay off interest and depreciation on it. You couldn’t do that if you pay outright and it ties up a big jump sum of money

 

[Jacko_G]

I'm currently toying with the idea of a new car. Not decided what I want or whether I require a new car. My current run around has 82k on the clock and today I dropped it off at the garage for a new wheel bearing and a strut mount needs replaced. It hasn't really given me any grief or big bills in 6 years of owning it but I'm now getting to the stage that I am thinking does it require to be axed?

I'm not a huge car buff, I know what I like but I also know what I can afford. I've never done a car on PCP but will look into it. I will argue over APR if it is crazy, there is usually room on that. It's either that or I buy second hand again and use my car as part exchange and throw some money at it.

 

[Hacker Khan]

I just realised the next wave of customer lock-ins. The PCP balloon payment these days now seem to be much higher than residual value. At the point of sale, the sales talk is all about how you will get a high residual value, but the reality is that a new car depreciates very quickly. So my old BMW run around had about 9.5k balloon after 4 years. Took it around to the dealers and online valuation and it all comes between 8-9k (It has all the normal wear and tear).
Non BMW dealerships wont use it as part exchange as it is negative equity. So ended up taking it to BMW which did a good deal on the new 1-series. Now really looking forward to seeing a new wheels when they get delivered next month (I hope there are no queues at the border).

Looked thru the paper work of the other car and looks very similar balloon-residual argument can be made there.


PS: The new 1-series now comes with indicators as standard

I kind of think people need to be very careful as the increasingly stringent environmental push and more cities introducing clean air zones could mean that what is not that polluting now may well be seen as very polluting in 4 years time, thus impacting its residual value a lot.

 

[Piece]

If you do go PCP, you do have to do your homework if you want to give yourself the best deal. There are several levers in play for the finance company to make money; e.g. a great APR maybe offset by a higher price. Or a great price might be offset by a chunky APR. Always look at the total you have to pay (inc. interest) and whether you can AND want to afford the monthlies.

I've always wanted something better and one I can update regularly. I couldn't do that realistically with ownership previously, so I've done the PCP route on nearly new cars with no intention to buy. My PCP is up around this time next year. If you want to buy outright, then other options are better.

 

[BristolMike]

I kind of think people need to be very careful as the increasingly stringent environmental push and more cities introducing clean air zones could mean that what is not that polluting now may well be seen as very polluting in 4 years time, thus impacting its residual value a lot.

But if you’re on a PCP it protects against that with a GFV. If it’s worth less you hand it back without penalty

 

[drdel]

But if you’re on a PCP it protects against that with a GFV. If it’s worth less you hand it back without penalty

But be careful when handing a car back if there's ANY damage, upholstery/ pets/ smoking not just dings you'll have to pay to get it ship shape. Any mileage over the plan can be around 14p/mile A mate had a charged of £2k on a lease car for 'seat' and interior damage. OK as long as people keep in mind its not and never is their car and take lots of photos at hand-back..

 

[BristolMike]

But be careful when handing a car back if there's ANY damage, upholstery/ pets/ smoking not just dings you'll have to pay to get it ship shape. Any mileage over the plan can be around 14p/mile A mate had a charged of £2k on a lease car for 'seat' and interior damage. OK as long as people keep in mind its not and never is their car and take lots of photos at hand-back..

A lease car and PCP are a bit different. Ive never ever had problem with a PCP car, but tbh I’ve never kept a car until the end. I rarely keep them beyond 2 years. You’re correct with what you said though, if things can reduce the value of a car beyond general wear and tear for its age of course they will take it back. Keep the car in good condition and it’s not a problem