PCP finance

[BusyBuilder]

has anyone used this method of getting a motorhome ?

 

[nicholsong]

has anyone used this method of getting a motorhome ?

No, paid cash, but out of interest what is PCP?

 

[BusyBuilder]

Personal Contract Purchase, like the car hire.

 

[enark]

Sounds like a scam to me

 

[Janine]

I don’t think it’s a scam but you would need to do the calculations.

I took it out when I bought my car last year because it came with perks like extended warranty and a couple of free services.

I paid it off a week later but got to keep the freebies.

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[Lenny HB]

Always paid cash for Motorhomes.

 

[dunnah01]

It sounds like a really expensive way to not own a Moho. The balloon payment will probably be as much as the current purchase price

 

[seasideBill]

Haven’t used PCP for my motorhome, but have used it several times to fund cars. Basically it allows you to acquire the vehicle for an agreed term that you might otherwise struggle to afford outright. Not right for everybody and interest rates are typically 10%+, but I can understand the attraction given soaring new MH prices. I think GAP insurance would be very wise in such circumstances given the values involved. As others have said, you must do your sums carefully to understand the implications of entering into such an agreement.

 

[GMLS]

I've always tried to work on the basis of cash for depreciating purchases and loans for appreciating.

 

[Diabalo]

Yep same here always cash, wouldn't have one if I had to finance it on the never never

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[seasideBill]

I've always tried to work on the basis of cash for depreciating purchases and loans for appreciating.

Yes, and on that basis PCP balloon payments were probably quite good value in the recent past given the sharp hike in prices. Final settlement payments would have been agreed prior to the rapid increase in post COVID values so those choosing to pay it and retain the vehicle would have got a MH more cheaply than dealer prices. That boat has probably sailed?

 

[GoCoeGo]

PCP deals that I have looked at (cars) all have a common theme... not worth it, if you plan to keep it. But if you fancy something new every X amount of years then it may be for you. If finance is the way to go, you can often take a private loan for a much better rate. Tesco for example have very low interest rates and no early repayments, plenty others also.

 

[Kups]

Sounds like a scam to me

Nah it's not, they've been available for the last 20 or more years. Ive bought a couple of cars this way. Still a very popular way of getting a car.

 

[The Coops]

All depends on what incentives are being offered and whether or not you can pay it off without incurring a financial penalty, if you take the PCP angle after a host of goodies thrown in. Then you can pay it off asap without a financial penalty, after all why pay someone 10% on borrowing their money when yours is only earning 4%

 

[potwalloper]

We purchased a new car today. The PCP was 0% over 24 months!

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[bobnick]

If i can't pay cash i can't afford it.

 

[enark]

Nah it's not, they've been available for the last 20 or more years. Ive bought a couple of cars this way. Still a very popular way of getting a car.

Sounds a scam to me, you pay top dollar, then still owe for the car.

Cash is king, and dont believe what any car dealer tells you.

 

[enark]

We purchased a new car today. The PCP was 0% over 24 months!

Cash would have taken 15% off that figure…

 

[seasideBill]

All depends on what incentives are being offered and whether or not you can pay it off without incurring a financial penalty, if you take the PCP angle after a host of goodies thrown in. Then you can pay it off asap without a financial penalty, after all why pay someone 10% on borrowing their money when yours is only earning 4%

The incentives can be tempting…. for example a 2 or 3 year service plan is worth quite a lot these days, plus if it allows you to ‘buy’ a new car with warranty that you otherwise couldn’t afford, there is the peace of mind and potential savings of a warranty for the duration of the PCP. Contributions to the deposit by the dealer/manufacturer are also commonplace.

 

[Just smiffy]

Never had anything unless I bought it, hence I never had much but what I did have was mine…

Mortgage was the the only one…

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[seasideBill]

Sounds a scam to me, you pay top dollar, then still owe for the car.

Cash is king, and dont believe what any car dealer tells you.

It’s not a scam, just a regulated financial product that suits some and not others.

 

[Nanniemate]

I don’t think it’s a scam but you would need to do the calculations.

I took it out when I bought my car last year because it came with perks like extended warranty and a couple of free services.

I paid it off a week later but got to keep the freebies.

That's a clever girl. Pcp can get very expensive large down.psument then monthly payments and a huge final payment
Way over what the vehicle is worth

 

[daventess]

Cash would have taken 15% off that figure…

That was certainly the case when I was young, but I'm not sure that's true anymore. I hear that vehicle dealers make more money selling on credit than on a cash purchase.

edit though I suppose if you pay more for cash up front, the overall cost to you without any interest would be cheaper.

 

[Lenny HB]

That was certainly the case when I was young, but I'm not sure that's true anymore. I hear that vehicle dealers make more money selling on credit than on a cash purchase.

edit though I suppose if you pay more for cash up front, the overall cost to you without any interest would be cheaper.

Yep, that's why they always try to push you to take the finance.

 

[Steve and Denise]

We could never afford credit as it’s a mugs game.
But got a new Mercedes on Mercedes finance and saved excess of £10k ? Best deal o the day

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[GMLS]

PCP deals that I have looked at (cars) all have a common theme... not worth it, if you plan to keep it. But if you fancy something new every X amount of years then it may be for you. If finance is the way to go, you can often take a private loan for a much better rate. Tesco for example have very low interest rates and no early repayments, plenty others also.

Bang on

 

[GMLS]

We purchased a new car today. The PCP was 0% over 24 months!

Yes but its probably not really 0% as I'd suggest you'd get a lower price if pure cash or via a broker or reverse auction.

 

[Wazzer1622]

You don't have to take dealer finance there is lots of private credit companies out there doing PCP so you could walk into the dealers negotiate your cash discount, then finance it at the lower price. These companies tend to have a far lower interest rate than dealers as well. Then instead of using all your cash to by a motor home you invest it in property or something else that makes you money. This money then pays your finance. At the end of it you have your motor home and it's cost you nothing

 

[Carpmart]

The danger with PCP and indeed the reason the dealers offer the incentives they do to try and get people to take it up, is it traps you in a cycle with them.

Get a new car on PCP for the first time and they then try and upsell you for a new one after a couple of years. They no longer focus on the price of the vehicle, but persuade you that for only £50 extra a month on your payments you can have the nice new shiny one…

This cycle perpetuates ad infinitum and leaves people trapped in continually paying for a car.

Despite being regulated, it’s all a bloody con IMHO, but I’ve been fortunate to be able to buy cars and not finance them!

 

[Steve and Denise]

You don't have to take dealer finance there is lots of private credit companies out there doing PCP so you could walk into the dealers negotiate your cash discount, then finance it at the lower price. These companies tend to have a far lower interest rate than dealers as well. Then instead of using all your cash to by a motor home you invest it in property or something else that makes you money. This money then pays your finance. At the end of it you have your motor home and it's cost you nothing

Along with all the other related rubbish that comes along with renting out houses don’t ask how I know