| Car financing.... 10:13 - Feb 25 with 5577 views | itfcjoe |
Think I need to get a new motor, and not sure Best approach to take.
I’ve usually bought outright out of savings, or topped up with a loan. Last couple of cars I wince as to how much much I lose quickly and effectively have thrown away out of savings.
I basically want a new or next to new motor, and want to get it the most cost efficient way - ie cheapest. Has anyone got experience with PCP or even just leasing one? Pros and cons etc as I’m leaning towards that avenue |  |
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| Car financing.... on 10:16 - Feb 25 with 3822 views | Ace_High1 |
I just changed mine and have gone PCP having always purchased cars outright like you in the past.
Once I got my head around paying for it each month, it actually works out well. I exchanged my existing car which paid the deposit, so was able to walk away from the showroom with a brand new car having only parted with £400 for the first months payment. I have a 3 year deal as I generally change mine every 3 years or so. |  | | |
| Car financing.... on 10:34 - Feb 25 with 3786 views | Bluefish |
I will admit to being involved in this for a living but not from a personal point of view just a corporate world. I wouldn't buy a car though.
There is so much uncertainty and change and more to come for cars and taxation that you don't want to be stuck with something impossible to sell. Work out the depreciation of your previous cars and stack it up against contract hire. Add in the peace of mind and choose a car with decent economy.
All cars are going to display 2 figures soon for nedc and wltp so becareful to compare like for like |  |
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| Car financing.... on 10:40 - Feb 25 with 3752 views | Reuser_is_God |
Get to change your car every 3 years
If at the end of that 3 years you want to keep your car then you can buy it for the residual value
They’re the pros, I’m sure there are many others, only con is that you never own the car but not sure that’s an issue tbh. |  |
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| Car financing.... on 10:41 - Feb 25 with 3739 views | itfcjoe |
| Car financing.... on 10:34 - Feb 25 by Bluefish |
I will admit to being involved in this for a living but not from a personal point of view just a corporate world. I wouldn't buy a car though.
There is so much uncertainty and change and more to come for cars and taxation that you don't want to be stuck with something impossible to sell. Work out the depreciation of your previous cars and stack it up against contract hire. Add in the peace of mind and choose a car with decent economy.
All cars are going to display 2 figures soon for nedc and wltp so becareful to compare like for like |
What about thoughts between PCP and straight out leasing? | |
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| Car financing.... on 10:43 - Feb 25 with 3735 views | Bluefish |
| Car financing.... on 10:41 - Feb 25 by itfcjoe |
What about thoughts between PCP and straight out leasing? |
It isn't really much of a consideration in my world so can't advise too much I'm afraid. | |
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| Car financing.... on 10:51 - Feb 25 with 3709 views | J2BLUE |
Buy a cheaper car you can afford without interest payments.
Unless you need a new one for some reason there’s really no point paying interest. |  |
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| Car financing.... on 10:51 - Feb 25 with 3705 views | PrideOfTheEast |
| Car financing.... on 10:40 - Feb 25 by Reuser_is_God |
Get to change your car every 3 years
If at the end of that 3 years you want to keep your car then you can buy it for the residual value
They’re the pros, I’m sure there are many others, only con is that you never own the car but not sure that’s an issue tbh. |
Yep this is what we do. Can’t say we researched too much but a few hundred quid a month for a new car plus a nominal deposit works for us. |  | | |
| Car financing.... on 10:52 - Feb 25 with 3699 views | linhdi |
| Car financing.... on 10:41 - Feb 25 by itfcjoe |
What about thoughts between PCP and straight out leasing? |
It's a straight financial decision. Sometimes you can get a cheaper deal with a straight lease rather than a PCP. I saved around £1200 over a 3 year / 36000 mile lease on a Mondeo by leasing rather than PCPing. But those deals are not always available. | | | |
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| Car financing.... on 10:58 - Feb 25 with 3663 views | Archer4721 |
| Car financing.... on 10:41 - Feb 25 by itfcjoe |
What about thoughts between PCP and straight out leasing? |
Can't you just lease it through your business? |  | | |
| Car financing.... on 10:59 - Feb 25 with 3660 views | Bluefish |
| Car financing.... on 10:51 - Feb 25 by J2BLUE |
Buy a cheaper car you can afford without interest payments.
Unless you need a new one for some reason there’s really no point paying interest. |
New cars are miles better. | |
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| Car financing.... on 11:07 - Feb 25 with 3644 views | MJallday |
the problem with car pcps is the baloon payment
Which is fine if you are going to swap every x years and can adhere to the mileage restrictions and don’t mind loosing any deposits if you hand it back/want to swap to another manufacturer
But it does give you a way of having a brand new car every x years
I’ve always just paid cash and personal loan over a longer period and paid it off with bank
HSBC have a good calculator on their homepage. I usually keep cars 3.5-4 years but I like to go to different manufacturers. It’s whatever works for you
Best thing about pcp in my view Is that if your job goes belly up you hand car back with no commitment on monthly payments |  |
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| Car financing.... on 11:15 - Feb 25 with 3613 views | Jimmy86 |
| Car financing.... on 11:07 - Feb 25 by MJallday |
the problem with car pcps is the baloon payment
Which is fine if you are going to swap every x years and can adhere to the mileage restrictions and don’t mind loosing any deposits if you hand it back/want to swap to another manufacturer
But it does give you a way of having a brand new car every x years
I’ve always just paid cash and personal loan over a longer period and paid it off with bank
HSBC have a good calculator on their homepage. I usually keep cars 3.5-4 years but I like to go to different manufacturers. It’s whatever works for you
Best thing about pcp in my view Is that if your job goes belly up you hand car back with no commitment on monthly payments |
What's the difference between PCP and hire purchase? The car finance deals I've had in the past have involved monthly payments, but no option to give the car back. Effectively the car was mine and I was paying for it monthly, until the finance was paid off.
Thought HP was when you were able to upgrade it to the newest model | | | |
| Car financing.... on 11:22 - Feb 25 with 3596 views | tcblue |
Personally I consider the balloon payment as an irrelevance as I've never wanted to keep a 3 year old car.
So, that puts PCP and leasing in a bit of a like for like on financial terms for me.
However, there's one big point that I don't think has been made on this thread, and it's the reason I go for PCP. With PCP, you can effectively hand the car back any time after 50% of your term is up without any further financial penalty than at the 3 year term (obviously you don't get any of your deposit back).
Less scrupulous people than I use this early handing back clause to get out of excess mileage fees, too.
With a lease, you sign up, legally, without get out clauses. | | | |
| Car financing.... on 11:24 - Feb 25 with 3593 views | ITFC_Forever |
The car I’ve got at the moment was the first one I’ve had to arrange myself for nearly 20 years, having had company cars before that, and I went with PCP.
Trouble was, I didn’t have a deposit to pay, so had higher monthly payments on a 3 year old car (when the deal started) and could only get terms for a 4 year deal, of which I’ve got just over a year left.
My mileage estimate has been fairly accurate, couple of hefty bills for the dual-mass flywheel and then the coolant pump going bang weren’t so much fun though. [Post edited 25 Feb 2018 11:25]
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| Car financing.... on 11:50 - Feb 25 with 3541 views | Basuco |
I always feel that a bank loan is the cheapest way to buy a car that little bit better than you can pay out right for, the thing to watch with lease cars is that they can get very picky about every little stone chip or scratch when it comes to handing them back, especially these days when second hand prices are falling through the floor. A one or two year old car can represent very good value these days with modern synthetic oil giving the engine much greater protection than previously and body rust is virtually a thing of the past. |  | | |
| Car financing.... on 11:52 - Feb 25 with 3537 views | DecageBruce |
I bought a 3 year old, ex lease, Astra recently. Bought it on CC and then did a 0% balance transfer to Virgin CC over 36 months. Interest free loan as far as I am concerned, can overpay when I want and have a saleable asset/deposit for my next one in 3 years |  | | |
| Car financing.... on 11:55 - Feb 25 with 3522 views | No9 |
| Car financing.... on 11:50 - Feb 25 by Basuco |
I always feel that a bank loan is the cheapest way to buy a car that little bit better than you can pay out right for, the thing to watch with lease cars is that they can get very picky about every little stone chip or scratch when it comes to handing them back, especially these days when second hand prices are falling through the floor. A one or two year old car can represent very good value these days with modern synthetic oil giving the engine much greater protection than previously and body rust is virtually a thing of the past. |
The Private Leasing Plans are pushing up the prices of new cars considerably.
The many who find they don't want to keep their 3 to 5 year old car has, as you say pushed used prices down and many of these ex PLP vehicles are low mileage well maintained there are good buys to be had.
Some like the Audi A8 can be very good buys | | | |
| Car financing.... on 11:57 - Feb 25 with 3497 views | Crofty |
| Car financing.... on 11:22 - Feb 25 by tcblue |
Personally I consider the balloon payment as an irrelevance as I've never wanted to keep a 3 year old car.
So, that puts PCP and leasing in a bit of a like for like on financial terms for me.
However, there's one big point that I don't think has been made on this thread, and it's the reason I go for PCP. With PCP, you can effectively hand the car back any time after 50% of your term is up without any further financial penalty than at the 3 year term (obviously you don't get any of your deposit back).
Less scrupulous people than I use this early handing back clause to get out of excess mileage fees, too.
With a lease, you sign up, legally, without get out clauses. |
This is not strictly true the 50% is total amount borrowed so not just the 50% of term as stated.
The other issue that most don't look at when looking at PCP is that you have to hand the car back in the same condition as when you purchased it i.e. No marks on body, alloys or interior.
The other thing to consider is will the circumstances change as excessive mileage is generally changed at 10p a mile. Also 4 year Pcp is not normally that much cheaper than 5 year hp depending on the Gfv and with hp you can still change the car after 3/4 years with little penalty so just make sure you go into it with your eyes open. | | | |
| Car financing.... on 12:04 - Feb 25 with 3472 views | Basuco |
| Car financing.... on 11:55 - Feb 25 by No9 |
The Private Leasing Plans are pushing up the prices of new cars considerably.
The many who find they don't want to keep their 3 to 5 year old car has, as you say pushed used prices down and many of these ex PLP vehicles are low mileage well maintained there are good buys to be had.
Some like the Audi A8 can be very good buys |
I would go further and say many big luxury cars are great value at two - three years old with mileage on a big engine not too much of an issue. | | | |
| Car financing.... on 12:08 - Feb 25 with 3460 views | Basuco |
| Car financing.... on 11:52 - Feb 25 by DecageBruce |
I bought a 3 year old, ex lease, Astra recently. Bought it on CC and then did a 0% balance transfer to Virgin CC over 36 months. Interest free loan as far as I am concerned, can overpay when I want and have a saleable asset/deposit for my next one in 3 years |
That is a brilliant idea. | | | |
| Car financing.... on 12:09 - Feb 25 with 3458 views | Pinewoodblue |
| Car financing.... on 11:57 - Feb 25 by Crofty |
This is not strictly true the 50% is total amount borrowed so not just the 50% of term as stated.
The other issue that most don't look at when looking at PCP is that you have to hand the car back in the same condition as when you purchased it i.e. No marks on body, alloys or interior.
The other thing to consider is will the circumstances change as excessive mileage is generally changed at 10p a mile. Also 4 year Pcp is not normally that much cheaper than 5 year hp depending on the Gfv and with hp you can still change the car after 3/4 years with little penalty so just make sure you go into it with your eyes open. |
Two downsides. Mileage...Circumstances can change and if you suddenly find you have to do a lot more miles it can be expensive. In past year wife spent 11 weeks in hospital in Sheffield and I clocked up 12,000 mile over that period.
Condition when you hand it back. They can be picky for example you get a chipped windscreen and your insurer gets it repaired, not good enough the lease company will want it replaced when you hand car back. |  |
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| Car financing.... on 12:11 - Feb 25 with 3457 views | No9 |
| Car financing.... on 12:04 - Feb 25 by Basuco |
I would go further and say many big luxury cars are great value at two - three years old with mileage on a big engine not too much of an issue. |
I picked the A8 as it is for some reason or other one car that can be obtained as a very low mileage bargain.
Many Mercs / BMW have high milege as heve the Rep breed. | | | |
| Car financing.... on 12:29 - Feb 25 with 3424 views | HennikerBlu |
| Car financing.... on 12:11 - Feb 25 by No9 |
I picked the A8 as it is for some reason or other one car that can be obtained as a very low mileage bargain.
Many Mercs / BMW have high milege as heve the Rep breed. |
I tend to go for ex-fleet cars and you can get low milers. They are generally well maintained mechanically if not so much body wise. I do shop around and not rush. Anything to do with finance I avoid like the plague, especially if you look at debt combined with depreciation a year after purchase. My sister has got into a horror story buying new on finance and the depreciation is huge. I used to fall victim to the 'oh shiny and new' but not so much now reliability is the key. | | | |
| Car financing.... on 14:35 - Feb 25 with 3310 views | No9 |
| Car financing.... on 12:29 - Feb 25 by HennikerBlu |
I tend to go for ex-fleet cars and you can get low milers. They are generally well maintained mechanically if not so much body wise. I do shop around and not rush. Anything to do with finance I avoid like the plague, especially if you look at debt combined with depreciation a year after purchase. My sister has got into a horror story buying new on finance and the depreciation is huge. I used to fall victim to the 'oh shiny and new' but not so much now reliability is the key. |
I agree buying new on finance, unless you can do it via a business and write of the debt or, get the VAT back etc. isn't a sound idea.
Depreciation largely caused by too many ex PLP low mileage cars on the forecourts have pushed down trade in values considerably | | | |
| Car financing.... on 15:14 - Feb 25 with 3230 views | Darth_Koont |
| Car financing.... on 10:59 - Feb 25 by Bluefish |
New cars are miles better. |
Are they though? Isn't that just the feeling you get from a new car?
Ridiculous amount of money to squander on a feeling that's gone after 6 months. |  |
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