Help me get my head around finance .....
Discussion
Hi Folks.
Our Zoe goes back in a month, end of PCP deal, while its been great being electric, we're not too impressed by either the Zoe, Renault customer services or too taken by a PCP so we've decided to buy a second hand leaf in its place.
We've found a car we like - on the forecourt at £8,500
If we take a finance deal we can pay:
Deposit £500
36 x £111.88 = 4027.68
Final Payment £ 2137.50
Means we can own the car for £ 6664.50.
We have to take some sort of finance deal to get the contribution from Nissan / dealer to bring the price down. Not a problem.
We then have the option of repaying the PCP immediately if we wish. Here's the tricky bit.
We aren't cash rich at the moment, so need to borrow most of the money one way or the other. The PCP is at 3.9% - my maths puts the total interest over the 3 yr period at £157.07 - am I right here?
I have the option of paying off the finance with a credit card then moving it to a 0% interest for 24months card. Is there any point in this other than saving the £157.07 on interest. Am I missing something here.
Not been involved much in finance before. Any advice / experience appreciated.
Many thanks
Our Zoe goes back in a month, end of PCP deal, while its been great being electric, we're not too impressed by either the Zoe, Renault customer services or too taken by a PCP so we've decided to buy a second hand leaf in its place.
We've found a car we like - on the forecourt at £8,500
If we take a finance deal we can pay:
Deposit £500
36 x £111.88 = 4027.68
Final Payment £ 2137.50
Means we can own the car for £ 6664.50.
We have to take some sort of finance deal to get the contribution from Nissan / dealer to bring the price down. Not a problem.
We then have the option of repaying the PCP immediately if we wish. Here's the tricky bit.
We aren't cash rich at the moment, so need to borrow most of the money one way or the other. The PCP is at 3.9% - my maths puts the total interest over the 3 yr period at £157.07 - am I right here?
I have the option of paying off the finance with a credit card then moving it to a 0% interest for 24months card. Is there any point in this other than saving the £157.07 on interest. Am I missing something here.
Not been involved much in finance before. Any advice / experience appreciated.
Many thanks
DuraAce said:
£6.5k car marked upto £8.5k then discounted to £6.5k to make you think you are getting a bargain?
You cannot blame retailers for doing this though.
We have just seen above that it does work, until you kindly pointed out how the magic trick works.
Remember the 'Buy one get one free' offers?
People really thought they were paying only £1 for two products priced at £1 each.
They should have looked at the product price a few weeks earlier. It would have been about 55 pence each.
The topic title is apt, but good on OP for asking others.
Edited by Jon39 on Thursday 1st June 16:16
scotlandtim said:
The PCP is at 3.9% - my maths puts the total interest over the 3 yr period at £157.07 - am I right here?
The interest amount seems too low - but as I presume the rate quoted is APR I don't think it can be easily worked out. You have to pay interest on the final payment for the whole 3yrs.The interest charge should be stated on the quotation. How much is the contribution from Nissan (and/or the dealer)?
If it really is £157 then that's only £4/mth. For that much it doesn't seem worth messing about and, you never know, the ability to walk away at the end might be useful.
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