PCP finance

[BusyBuilder]

has anyone used this method of getting a motorhome ?

 

[Ray-Vic]

PCP is a reasonable way for someone who doesn't have the cash to be able to drive a new car every few years. Bottom line is, if you can't afford to buy the car in the first place, then you probably wouldn't be able to afford the deposit, monthly payments and then the balloon payment at the end, so you use the vehicle's residual value towards the deposit for a new vehicle, and there you are in a perpetual cycle that is very difficult to get out of without losing a chunk of cash. This generally works ok with cars as you would normally need a car pretty much until you stop driving, but that may not be the case for many with motorhomes, especially those that are new to it, as they are mostly a nice to have item and not an essential (obviously I know for full-timers they are essential).

PCP is an expensive way to actually own a vehicle, but is a reasonably cost effective way to drive a new vehicle without actually owning it if you want to commit to being in a PCP for several vehicles.

Don't forget also, as this is effectively a rental agreement as you don't own the vehicle until you pay the (often large) balloon payment, there are very strict criteria to adhere to with regards to servicing and mileage allowance etc.

As others have said, nowadays you generally get better deals for taking a finance option as dealers get a kick-back from the finance house.

 

[Markman]

That's a clever girl.

Starting a response with this phrase I find to be rude, misogynist and completely unnecessary.

 

[Steve and Denise]

Starting a response with this phrase I find to be rude, misogynist and completely unnecessary.

There’s a clever boy

 

[Markman]

There’s a clever boy

Not clever, just my opinion.

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[Carpmart]

Starting a response with this phrase I find to be rude, misogynist and completely unnecessary.

Are you aware of any friendships and or personal relationships between the two Funsters? It could be completely contextually fine… of course you could also be correct!

 

[Steve and Denise]

Not clever, just my opinion.

It’s a bit like your name Markman/Markwoman I don’t really see the problem?

 

[gus-lopez]

Sounds like a scam to me

as said been about for years

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

& most younger people only buy this way as otherwise they cannot afford it

Cash would have taken 15% off that figure…

But they do not have any & many put the initial down payment on the credit card as well

and a huge final payment
Way over what the vehicle is worth

No, they roll over in to another new vehicle in perpetuity

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,

Here in spain if you do not take the dealers finance then the price of the car goes up considerably.They actually advertise showing both prices.

is it traps you in a cycle with them.

This^^^^^^^^

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!

& they say that the next 'financial crisis ' similar to 2008 will be solely due to pcp both in the states & uk

 

[Lenny HB]

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…

What bugs me is car adverts they never give the price of the car just how much it will cost you per month, I've no interest in that I want to know how much it is.

most younger people only buy this way as otherwise they cannot afford it

My daughter could do with a new car but she won't buy one at the moment she doesn't want finance she will wait until she can afford one. She was brought up proper.

 

[bobnick]

We are off to look at a new car in about an hour to replace our Titty...well it is nearly 3 years old and got a massive 11,000miles so ready to change.

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[Ray-Vic]

We are off to look at a new car in about an hour to replace our Titty...well it is nearly 3 years old and got a massive 11,000miles so ready to change.

We were discussing car mileage recently. My Mother, who no longer drives, only 2 years ago had her DLA car go back at the end of its 3-year term with 400 miles on the clock! I put most of those miles on it just to give it a run every now and then.

The AA came out to start it when the battery was flat, and noted he had just been to a 3-year old DLA car with 50 miles on the clock, so my Mother's was not so bad.

Happy car hunting.

 

[potwalloper]

Cash would have taken 15% off that figure…

Not so. I negotiated for cash purchase and got a significant discount. The PCP 0% discussion happened after we had agreed the discounted cash price. In the small print, the dealer made £200 on the finance. We think we got a good deal.

 

[enark]

& most younger people only buy this way as otherwise they cannot afford it

Sadly thats the problem.

For some reason they are now conditioned to “must have brand new” , as us older people well know - first car maybe £200.

Also sadly pcp salesmen are like drug dealers - get you hooked, then your in for life - new car sir?

 

[bobnick]

Think the dealers have to declare somewhere that they get a commission from whomever might finance the car. Relatively new thing.

 

[Diabalo]

I believe there is some sort of legal action going on at the moment with PCP over miss selling, I could be wrong but I think there was a court ruling a couple of years ago and it's now being investigated.

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[The Wino]

I have a friend who is a retired car dealer. He's very interesting to talk to. He says he made most of his money on people's vanity wanting a new reg plate or new car when there's was perfectly okay. He also says if most people buying on a PCP sat down with a piece of paper and worked out the figures there's no way they would go for one.
We recently bought a new pre registered MG. It was just under £22k for cash if we had wanted to buy on PCP there was a very low interest rate but on a higher price! The PCP would include servicing but a three year dealer service plan was £299.
The advantage of a PCP is you have a fixed final payment and an option to just walk away but when you think about it the finance people need to make a profit the dealer will get a bigish backhander where does it come from?

 

[BusyBuilder]

Norton motorcycle had a pcp deal just before new year, a £13500 bike could be on pcp for £39 down and £39 pm. Over two years it was a no brainer if you fancied a new bike.

 

[seasideBill]

Think the dealers have to declare somewhere that they get a commission from whomever might finance the car. Relatively new thing.

Yep, a commission declaration document is normally provided detailing the payment.

 

[wildcampers69]

In general if you look at the reality on buying a new car on PCP you will only pay a percentage more than the cash route as you are paying the depreciation of the car with a future value calculation built in but this can go both ways depending on the market you may end up with equity or not in the end, but you will always loose at least 50% in 3 or 4 years buying a new car, motorhomes may actually be the exception to the rule with normally good value retention. Not everyone is in the position to pay cash especially the younger generation. My advise would always be cash for secondhand if you can afford it.

 

[Nanniemate]

Starting a response with this phrase I find to be rude, misogynist and completely unnecessary.

This made me laugh out loud

Misogynist.....interesting comment to a woman

Rude...I can be ....look in rhe mirror

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

Clever ...quick to understand, devise ideas , intelligent

Girl ...female child, young girl/lady.......tends to be used for many women no matter what their age

Girls night out,
where are the girls
Where the girlie room ...loos

But here's an amended version

That's a really intelligent idea for a woman of indeterminate age . Using the services to your advantage without having to pay the huge final payment or never actually own the car.

Ps it's raining out and I'm bored and I'm in not way offended just amused

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[gus-lopez]

What bugs me is car adverts they never give the price of the car just how much it will cost you per month, I've no interest in that I want to know how much it is.

Sign of the times.Very few buy a vehicle with there own money these days

Norton motorcycle had a pcp deal just before new year, a £13500 bike could be on pcp for £39 down and £39 pm. Over two years it was a no brainer if you fancied a new bike.

I watched a yank you tuber the other night who was on about this .He was ranting about pcp deals but pointed out that one manufacturers deal was too good to pass up.
70,000$ car 4k$ down 299$/month for 24 months . total 11,200$
As hes said on that basis they were saying that after 24 months the resale value would be above 59k.As he said absolute ********ks . After 2 years it would be lucky to make 40k.
Even if you paid cash & got a 10 or 15k$ discount it was still not worth buying when you could pcp at there expense

 

[Nanniemate]

Sign of the times.Very few buy a vehicle with there own money these days

I watched a yank you tuber the other night who was on about this .He was ranting about pcp deals but pointed out that one manufacturers deal was too good to pass up.
70,000$ car 4k$ down 299$/month for 24 months . total 11,200$
As hes said on that basis they were saying that after 24 months the resale value would be above 59k.As he said absolute ********ks . After 2 years it would be lucky to make 40k.
Even if you paid cash & got a 10 or 15k$ discount it was still not worth buying when you could pcp at there expense

My friend got caught with a fiat500
Thought she was buying it on HP
It was only 2 years down the road when she went to pay it off on retirement that she understood the implications

She paid well over what the car was worth and did not have the income to keep paying for the rest of her life.

She now owes the car outright but she and I both feel she was conned. Her husband wanted to take it back

Straight through the showroom window. But we all agreed one bad decision should lead to another.....

 

[gilbaro]

Been buying my cars on PCP for years. Last one in Mar 23. 0 deposit low % rate and paying less than I was for previous car of same make and spec.
Once you have paid half payments you can just give it back if you want which is sometimes a better deal than Px. I have done both.
With manufacturer and dealer contributions along with a bit of negotiating it was cheaper than a cash deal.
For me it is best way to keep running a newish car which always stays in warranty.
You pays your money and makes your choice.

 

[Janine]

Starting a response with this phrase I find to be rude, misogynist and completely unnecessary.

Thank you for your concern but Nanniemate Lois is a friend

 

[Janine]

Are you aware of any friendships and or personal relationships between the two Funsters? It could be completely contextually fine… of course you could also be correct!

Can I just say that there is absolutely NO personal relationship between me and Nanniemate - despite the rumours……

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[Nanniemate]

Can I just say that there is absolutely NO personal relationship between me and Nanniemate - despite the rumours……

Oh no more rejection

 

[enark]

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!

Exactly, just like drug dealers - fancy a free sample? Then hooked

 

[BusyBuilder]

My understanding is at the end of the PCP agreement you hand the vehicle back and walk away.

The Norton Commando PCP deal was better if you went for a slightly used model. £22 deposit and £22 per month, now that really is a deal.

 

[Ray-Vic]

My understanding is at the end of the PCP agreement you hand the vehicle back and walk away.

The Norton Commando PCP deal was better if you went for a slightly used model. £22 deposit and £22 per month, now that really is a deal.

At the end of a PCP you have options. You can hand it back and treat it as though it was a rental (this is based on the vehicle being worth more than the balloon payment or you would be liable for the difference). You can also pay the balloon payment and buy the car, or you can use the trade in value of the car at this point (actually any point past 50% of total cost paid) to use as the deposit against another new car. This is what most do as it lets you retain a new car every few years with little or no capital outlay.

As noted previously and by others, PCP can be a good idea on cars where you will be having a car for many years and are able to have a new one regularly where you ordinarily couldn't afford to. Whether that same positive is transferrable to motorhomes, I'm not so sure, but technically it should if you want to keep changing. You certainly wouldn't be allowed to carry out any alterations or modifications that's for sure.

 

[Nanniemate]

My understanding is at the end of the PCP agreement you hand the vehicle back and walk away.

The Norton Commando PCP deal was better if you went for a slightly used model. £22 deposit and £22 per month, now that really is a deal.

Seems to be focused on monthly payments rather than overall cost .it's a lease agreement rather than a purchase .
Many people have to give the car back as they do not have the cash to.pay the final payment .

It's is not always clearly understood the full cost if the purchaser want to own a vehicle outright.

I understand many people have continuous HP agreements and never pay a car off as they change it every 2/3 years.and they just look at it as a monthly bill. That has to be paid.

It's personal choice as long as the purchaser is fully aware of the implications

I don't like debt it makes me very uncomfortable. I like to buy it so I owe nothing to no one. If circumstances change. I can sell/dispose of vehicles. Which I feel is a better option than having them taken away.

Yes I have bought on interest free credit when I needed a reliable car fast. But I didn't like it especially as the car was stolen the same month it was paid for ...so no car not paid full value by insurance. So next one was bought in cash /credit card and paid off in full

15 years later it was sold on it never cost me a penny except service and tyres

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[Taran_Las]

If I was a new start-up company, but didn't have spare cash to buy a new vehicle I'd use PCP. Some companies need a certain standard of vehicle to give the appearance of being successful.