Author Topic: Buying a new car - finance plans  (Read 1500 times)

qwerty123

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Re: Buying a new car - finance plans
« Reply #15 on: October 17, 2017, 01:49:34 PM »
I would never buy a new car either and my thoughts were to do something like Eamonnca1 but then I heard about these other schemes and wondered if it made more financial sense. In theory leasing a new car should greatly reduce the service bills, no MOT etc. Even less sure now!lol

Frank_The_Tank

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Re: Buying a new car - finance plans
« Reply #16 on: October 17, 2017, 01:49:39 PM »
I'm just wondering if it's more cost effective to buy a car outright/using a loan vs using something like pcp or pch so that you can keep getting a new car.
If i buy a car for 8k and i have it for 10 years that's 800 per year which is a hell of a lot less than any monthly payments with pcp/pch. Would the extra service and maintenance that go with an older car make up for the difference?

Various people have said that they would never own a car again as it's not worth it financially.

Bought a 2017 A5 a few months ago and went with PCP.  Mine is a 3-year term.  There are 3 options at the end of the term

1) Hand car back and walkway
2) Pay the remaining money owed in lump sum and own the car
3) Hand car back and start new term with another brand new car - the car dealership will have gave a minimum amount the car will be worth - if you are within the mile per year it will most likely be worth more than the amount you owe so you will use the difference as deposit for next new car.

A guy in work is on PCP as well - he just changed his a few weeks ago - he was nearly 30K miles over the amount allowed - as he was continuing on with a new car he wasn't actually charged for the extra miles done but he had no equity in the car to go towards a deposit for new car but he had 5k saved for that deposit

Franko

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Re: Buying a new car - finance plans
« Reply #17 on: October 17, 2017, 01:57:40 PM »
I'm just wondering if it's more cost effective to buy a car outright/using a loan vs using something like pcp or pch so that you can keep getting a new car.
If i buy a car for 8k and i have it for 10 years that's 800 per year which is a hell of a lot less than any monthly payments with pcp/pch. Would the extra service and maintenance that go with an older car make up for the difference?

Various people have said that they would never own a car again as it's not worth it financially.

Bought a 2017 A5 a few months ago and went with PCP.  Mine is a 3-year term.  There are 3 options at the end of the term

1) Hand car back and walkway
2) Pay the remaining money owed in lump sum and own the car
3) Hand car back and start new term with another brand new car - the car dealership will have gave a minimum amount the car will be worth - if you are within the mile per year it will most likely be worth more than the amount you owe so you will use the difference as deposit for next new car.

A guy in work is on PCP as well - he just changed his a few weeks ago - he was nearly 30K miles over the amount allowed - as he was continuing on with a new car he wasn't actually charged for the extra miles done but he had no equity in the car to go towards a deposit for new car but he had 5k saved for that deposit

If you don't mind me asking Frank, what's the monthly payment on a deal like that and who's it with?

Frank_The_Tank

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Re: Buying a new car - finance plans
« Reply #18 on: October 17, 2017, 02:09:25 PM »
I'm just wondering if it's more cost effective to buy a car outright/using a loan vs using something like pcp or pch so that you can keep getting a new car.
If i buy a car for 8k and i have it for 10 years that's 800 per year which is a hell of a lot less than any monthly payments with pcp/pch. Would the extra service and maintenance that go with an older car make up for the difference?

Various people have said that they would never own a car again as it's not worth it financially.

Bought a 2017 A5 a few months ago and went with PCP.  Mine is a 3-year term.  There are 3 options at the end of the term

1) Hand car back and walkway
2) Pay the remaining money owed in lump sum and own the car
3) Hand car back and start new term with another brand new car - the car dealership will have gave a minimum amount the car will be worth - if you are within the mile per year it will most likely be worth more than the amount you owe so you will use the difference as deposit for next new car.

A guy in work is on PCP as well - he just changed his a few weeks ago - he was nearly 30K miles over the amount allowed - as he was continuing on with a new car he wasn't actually charged for the extra miles done but he had no equity in the car to go towards a deposit for new car but he had 5k saved for that deposit

If you don't mind me asking Frank, what's the monthly payment on a deal like that and who's it with?

Sent you a PM Franko

thebigfella

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Re: Buying a new car - finance plans
« Reply #19 on: October 17, 2017, 05:09:40 PM »
Its a bit of a generalisation you lose 20% by putting the plates on it. Depends very much on the car and what you payed for it vs thd list price.
Last car I bought I had 24% of the total list price and holding the value still a year later.

Franko

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Re: Buying a new car - finance plans
« Reply #20 on: October 18, 2017, 07:30:07 AM »
Its a bit of a generalisation you lose 20% by putting the plates on it. Depends very much on the car and what you payed for it vs thd list price.
Last car I bought I had 24% of the total list price and holding the value still a year later.

Good man.

Franko

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Re: Buying a new car - finance plans
« Reply #21 on: October 18, 2017, 07:30:29 AM »
I'm just wondering if it's more cost effective to buy a car outright/using a loan vs using something like pcp or pch so that you can keep getting a new car.
If i buy a car for 8k and i have it for 10 years that's 800 per year which is a hell of a lot less than any monthly payments with pcp/pch. Would the extra service and maintenance that go with an older car make up for the difference?

Various people have said that they would never own a car again as it's not worth it financially.

Bought a 2017 A5 a few months ago and went with PCP.  Mine is a 3-year term.  There are 3 options at the end of the term

1) Hand car back and walkway
2) Pay the remaining money owed in lump sum and own the car
3) Hand car back and start new term with another brand new car - the car dealership will have gave a minimum amount the car will be worth - if you are within the mile per year it will most likely be worth more than the amount you owe so you will use the difference as deposit for next new car.

A guy in work is on PCP as well - he just changed his a few weeks ago - he was nearly 30K miles over the amount allowed - as he was continuing on with a new car he wasn't actually charged for the extra miles done but he had no equity in the car to go towards a deposit for new car but he had 5k saved for that deposit

If you don't mind me asking Frank, what's the monthly payment on a deal like that and who's it with?

Sent you a PM Franko

Cheers Frank

Eamonnca1

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Re: Buying a new car - finance plans
« Reply #22 on: October 18, 2017, 09:00:25 PM »
Remember the days when you rented a TV because they were so unreliable that you needed to have someone on call to come out and fix it when it went on the blink? Doesn't make a whole lot of sense with the reliability of modern TVs so businesses like Radio Rentals are a distant memory.  I feel like we've reached the same point with the reliability of cars now. The only reason I'd have to see a mechanic now would be to rotate the wheels, and that's only because I have no way of lifting the whole thing off the ground. Routine oil changes or replacing the headlight bulbs is something I can do myself. I feel like a warranty on a new car would just be a big waste of money.

GJL

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Re: Buying a new car - finance plans
« Reply #23 on: October 18, 2017, 10:21:19 PM »
Remember the days when you rented a TV because they were so unreliable that you needed to have someone on call to come out and fix it when it went on the blink? Doesn't make a whole lot of sense with the reliability of modern TVs so businesses like Radio Rentals are a distant memory.  I feel like we've reached the same point with the reliability of cars now. The only reason I'd have to see a mechanic now would be to rotate the wheels, and that's only because I have no way of lifting the whole thing off the ground. Routine oil changes or replacing the headlight bulbs is something I can do myself. I feel like a warranty on a new car would just be a big waste of money.

Can you change a timing belt? Can you service your brakes. Can you change a clutch/flywheel? Have you a diagnostic computer? Can you align your steering? Can you service your suspension?

I could go on...
« Last Edit: October 18, 2017, 11:46:24 PM by GJL »

ned

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Re: Buying a new car - finance plans
« Reply #24 on: October 18, 2017, 10:51:17 PM »
An example of different ways to buy a car.

Focus ST-Line 1.0 EcoBoost 140PS on Ford website PCP 3 year deal:
0% APR, Customer Deposit 5,610, Monthly Payment 209, Optional Final Payment, 7,996.
You can get better deal than this I'm sure if you go for pre registered or a demonstrator.

Similar car to lease 152.72 per month, Processing Fee: 198.00, Initial Rental 916.32, 2 year deal. These deals usually includes road tax and sometimes break down cover.

10k loan for 2 year old car, 2.8% APR based on borrowing 10,000 and repaying over 60 months with 60 monthly repayments. Monthly repayments of 178.64 with total amount repayable of 10,718.40.

You need to decide what you want from a car. If you want a vehicle to get you from here to there, buy second hand and pay off a loan. Downside here is you may have little or no warranty, potentially more costly with repairs and MOT is a factor, may be less efficient.
 A new car on PCP gives you warranty, reduces potential repair costs and you have a car that no one else has driven. Downside is you will end up paying more and may be stung with no equity at end of the deal.
Leasing is cheaper, get a new car and full warranty included. Downside is you will never own the car (not an issue if you want to change regularly), you have to find the initial lump sum payment each time you start a new deal, potential costs as car has to be in good condition at end of the deal. Mileage really shouldnt be an issue as you should be aware of what you need at beginning of deal. Also it is usually only 10p a mile give or take a couple of pence. Therefore, 1 for every extra ten miles. So if you did 2,000 extra miles that equates to 200.

I would probably go with a lease or PCH.

thebigfella

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Re: Buying a new car - finance plans
« Reply #25 on: October 18, 2017, 11:44:45 PM »
Remember the days when you rented a TV because they were so unreliable that you needed to have someone on call to come out and fix it when it went on the blink? Doesn't make a whole lot of sense with the reliability of modern TVs so businesses like Radio Rentals are a distant memory.  I feel like we've reached the same point with the reliability of cars now. The only reason I'd have to see a mechanic now would be to rotate the wheels, and that's only because I have no way of lifting the whole thing off the ground. Routine oil changes or replacing the headlight bulbs is something I can do myself. I feel like a warranty on a new car would just be a big waste of money.

Can you change a timing belt? Can you service your brakes. Can you change a clutch/timing belt? Have you a diagnostic computer? Can you align your steering? Can you service your suspension?

I could go on...

Ah don't start on him, he'll report you to the mods 😀


thebigfella

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Re: Buying a new car - finance plans
« Reply #26 on: October 19, 2017, 12:17:32 AM »
Also if your buying new or 2nd hand from a dealer, cash won't necessarily get you a better deal. The way the deals are structured, part of the discounts come from taking out the finance. For example there may be 5k of the new car but 50% of that is made up from the dealer and the other 50% from the finance company before you even negioate.

Also remember the sales person/dealer will get commission on signing you to a finance deal as well. So if you pay cash they lose that commission and will be less likely to negioate as they effectively lose that cash which would compensate any additional discount out of their margins.

You can take the PCP and effectively pay it off after you drive out of the dealership, effectively you only pay the pro rated interest. Remember though, the sales person may only get the commission after a few months; if you want to a maintain a good relationship with them then only pay it off once you know the commission terms has been met. That few quid may be worth it in the long run.

Frank_The_Tank

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Re: Buying a new car - finance plans
« Reply #27 on: October 19, 2017, 10:02:57 AM »
I was buying in the North so used CarWow as well to get some deals beforehand from Across the water and then got my local dealer to match that and throw in a few extras (3 Free Year GAP Insurance for example)

https://www.carwow.co.uk/

Owen Brannigan

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Re: Buying a new car - finance plans
« Reply #28 on: October 19, 2017, 01:51:58 PM »
I was buying in the North so used CarWow as well to get some deals beforehand from Across the water and then got my local dealer to match that and throw in a few extras (3 Free Year GAP Insurance for example)

https://www.carwow.co.uk/

In our house we bought the last four cars this way.  Car Wow dealers can really undercut local dealers.  Some will match and others will walk away when shown the deals.  Make sure you get the dealer to send their finance deal to you on their own headed paper as this authenticates your deal when showing it to a local dealer.