Buy it on pcp finance deal then pay it off the next day?
When I got my 200, taking it on the finance deal the monthly payments over the term + final value fee were about 5k less than if I'd gone in with the coin in my hand.
Worth checking out....
Also at the time a FF 200 was £10 more a month than a cup. IIRC adding aircon to a cup came to an extra £18 a month.
Adam, I appreciate your input, however I think you need to look at your PCP again. Im not saying theres anything wrong with PCP, but the facts are you will pay interest on that figure which may or may not be cheaper than a bank loan, but you will not have legal entitlment to the car, it is leased to you. You cannot sell, modify etc should you wish to.
Regards the deal you brokered, you will ultimately have a total sale value on the car when new, and then it is broken down into monthly payments (minus deposit) with a final value fee to actually buy the car at the end of the term (thats when you own it). This obviously varies as to what you initial deposit is. Ignoring the extra payment for gap insurance, the only way the car could be 5k lower is if the dealer was selling it at around 13k to 14k or the other offers you looked at had crazy interest on them.
PCP is fine and I have used it before, but only for company car allowances, where owning the car is not of importance.
Having said all that, if you get 0% than it may be worth considering. I think alot of people dont trully understand lease schemes and what you actully pay.
So..... deposit, plus total monthly payments with or without interest and the final purchase fee, should you buy it at the end of the term, is equel to 5k less than buying outright???
If you exclude the final purchase payment, than yes they work out cheaper, but you never own the car and at the end of the term you have payed alot of money into the agreement with nothing to show for it. And dont get me started on the milage limits imposed and cost incurred if breached
PS: dont buy into the sale bull of "if you continue to lease its effectively like getting a free car after 5 lease terms", it does not work out. They value the cars at higher values then they are actually worth at the end of the term. Thats why you have to get the Gap insurance. Likewise if its nicked.
Sorry if this is a little long winded.
I prefer to loan some of the money at a good rate which may be 1% higher then most pcp deals (always check annual APR), than a deposit as normal and own the car while paying of the loan, free to sell and buy another at anytime with no finance to settle. At the end of the loan, what I own is all mine and I can keep or sell, and the value of what is left of the car is mine etc. Just a preference but worth thinking about if really want to own the car your driving.
Forgot to ask. How would it work out cheaper getting finance then paying it off?? I will have incurred admin fees and gap insurance cost on top?? Possibly early settlement fees too.
