PCP deal calculation help
Discussion
Please be patient with me as this is my first foray into PCP however I think the figures doesn't really stack up.
Below are the details of the quote I have received:
Car retail value : £35,999
P/X value : £13,000 (to be used as deposit)
PCP 49 months £227.33 per month with an optional final future value of £13798.75p
To me with such a large deposit the monthly payments should be lower?
Also assuming at the end of the 49 month term I return the car I will have to then raise capital for deposit for the next car. Let's say I have £4,000 as deposit does that mean my future PCP monthly payments would be circa £500/month for a car that retails around £36,000?
edit: I have not offered to give any further so I guess the PCP deposit = 0% and £13k is purely to take the retail value down to £22,999?
Not sure about APR but it's Audi Finance to 7-7.1%?
Below are the details of the quote I have received:
Car retail value : £35,999
P/X value : £13,000 (to be used as deposit)
PCP 49 months £227.33 per month with an optional final future value of £13798.75p
To me with such a large deposit the monthly payments should be lower?
Also assuming at the end of the 49 month term I return the car I will have to then raise capital for deposit for the next car. Let's say I have £4,000 as deposit does that mean my future PCP monthly payments would be circa £500/month for a car that retails around £36,000?
edit: I have not offered to give any further so I guess the PCP deposit = 0% and £13k is purely to take the retail value down to £22,999?
Not sure about APR but it's Audi Finance to 7-7.1%?
Edited by crazy about cars on Saturday 13th December 14:51
Edited by crazy about cars on Saturday 13th December 14:54
Roo said:
Figures look about right.
The last thing I'd be doing though is chucking a 30% deposit into a PCP.
I am going for a p/x hence why the full p/x valuation into the PCP deal. Ideally I would like a "refund" from 13k so say put down £5k and dealer refund £8k but that will double my PCP monthly payments which would be the same as going on HP...The last thing I'd be doing though is chucking a 30% deposit into a PCP.
To my layman eyes paying £200-ish a month for a brand new S3 does seem tempting but I am sure if that's a wise move financially.
3 door manual S3 but with lots of toys.
He came back to me with figure of £348/month but never confirmed GFV. He was saying it's hard to beat this number but I have a website open with a simple PCP calculator so I've asked some questions and in the end he admitted that figure is not really competitive
He did say if I go for a brand new car with almost the same spec I'm looking at for £250/month. I asked about dealer contributions on new cars but he said there's none for now but potentially could be. However I sense he wants me to commit now but if it's a new car I'll definitely need more time to think. I wanted a used car which I can have before Christmas.
In the end he said he will try to source a pre-reg car for me and get back to me.
Stupid question but is GFV what the car is estimated to be worth at end of term and also how much I need to pay to own the car?
He came back to me with figure of £348/month but never confirmed GFV. He was saying it's hard to beat this number but I have a website open with a simple PCP calculator so I've asked some questions and in the end he admitted that figure is not really competitive
He did say if I go for a brand new car with almost the same spec I'm looking at for £250/month. I asked about dealer contributions on new cars but he said there's none for now but potentially could be. However I sense he wants me to commit now but if it's a new car I'll definitely need more time to think. I wanted a used car which I can have before Christmas.
In the end he said he will try to source a pre-reg car for me and get back to me.
Stupid question but is GFV what the car is estimated to be worth at end of term and also how much I need to pay to own the car?
daemon said:
I dont think thats a good deal at all.
You're putting a lot of equity into the deal, but after 4 years you've still to find around £14,000 to buy the car outright.
If you really want to own this car, then as you say approx £420 ish a month will get you a 5 year loan.
If you dont, then you'd be as well looking at leasing. There were Golf R deals going around at approx £250 a month with £1500 down.
Thanks - that's what the missus thinks too regarding the big equity.You're putting a lot of equity into the deal, but after 4 years you've still to find around £14,000 to buy the car outright.
If you really want to own this car, then as you say approx £420 ish a month will get you a 5 year loan.
If you dont, then you'd be as well looking at leasing. There were Golf R deals going around at approx £250 a month with £1500 down.
Edited by daemon on Saturday 13th December 15:06
Apologies for being numpty but I thought PCP and leasing is the same? £1,500 deposit and £250/month is tempting! I can sell my current car instead of P/X and pocket the cash for next deposit.
As you can tell from my responses I am not really clued up enough about PCPs :P
So, if I have a car I am looking to part exchange (or sell) for another car with the criteria below what will be my best option?
So, if I have a car I am looking to part exchange (or sell) for another car with the criteria below what will be my best option?
- Let's say my current car is worth £13,000.
- I like to change my cars often so say every 3 years I would want a new car.
- I don't do big miles (if I do I have alternative means of transport provided) and only do around 8-10k miles a year.
- I won't be modding my car.
- I would prefer maintenance to be covered for the 3 years but not a deal breaker.
- I would prefer to have the car as soon as possible so not wait few months for a new build but again if it's a massive saving it's not a deal breaker.
CoolHands said:
crazy about cars said:
I wanted a used car which I can have before Christmas.
Sounds like you're rushing into it. Is that wise?I'm not sure how true is this but someone mentioned December is a good month to negotiate on used car as most dealerships are desperate to sell stock.
AGK said:
If it's not new then the APR will be around 12%.
Always best to buy new with Audi.
Also factor in 10% discount which is easily achievable.
FWIW I got a quote the other day on a brand new Sportback S-tronic and with discount and adding 13k for deposit the payments would be around the £140 a month mark.
Did you get the quote on Audi website? With that figure I guess it's PCP? What's the GFV is you don't mind me asking.Always best to buy new with Audi.
Also factor in 10% discount which is easily achievable.
FWIW I got a quote the other day on a brand new Sportback S-tronic and with discount and adding 13k for deposit the payments would be around the £140 a month mark.
Right, got a call with the following offer on a brand new car. Same spec too.
OTR Price : £35,875
GFV : £15,310
PCP term : 48 months
PCP monthly : £270/month
He never mentioned px value but I guess it's still £13,000
Cost of PCP over 48 months = £12,960
Total cost of car = £12,960 + £15,310 + £13,000 (deposit) = £41,270
Now let's say I borrow on car loan:
Amount to borrow = £35,875 - £13,000 = £22,865
Estimate based on 6% APR over 48 months for £22,900 = £536.24/month.
Total repayment = £25,739.52
Total cost of credit = £2,839.52
Total cost of car = £25,739.52 + £13,000 (deposit) = £38,739.52
So it will be around £2,500 cheaper if I borrow on loan compared to HP plus the car will always be in my name?
Scenario with PCP is that I would need to save up at least 4-5k deposit and am looking to pay £400+/month for a car worth £35k in 48 months' time.
Hmmm... tempted as it's a spanking new car with delivery miles but not sure if this is a good PCP deal?
Put the figures here and something is not right... unless interest is 30%?
http://www.pcp-calculator.com/PCP-loan-calculator....
OTR Price : £35,875
GFV : £15,310
PCP term : 48 months
PCP monthly : £270/month
He never mentioned px value but I guess it's still £13,000
Cost of PCP over 48 months = £12,960
Total cost of car = £12,960 + £15,310 + £13,000 (deposit) = £41,270
Now let's say I borrow on car loan:
Amount to borrow = £35,875 - £13,000 = £22,865
Estimate based on 6% APR over 48 months for £22,900 = £536.24/month.
Total repayment = £25,739.52
Total cost of credit = £2,839.52
Total cost of car = £25,739.52 + £13,000 (deposit) = £38,739.52
So it will be around £2,500 cheaper if I borrow on loan compared to HP plus the car will always be in my name?
Scenario with PCP is that I would need to save up at least 4-5k deposit and am looking to pay £400+/month for a car worth £35k in 48 months' time.
Hmmm... tempted as it's a spanking new car with delivery miles but not sure if this is a good PCP deal?
Put the figures here and something is not right... unless interest is 30%?
http://www.pcp-calculator.com/PCP-loan-calculator....
Edited by crazy about cars on Saturday 13th December 16:31
Right put down £1,000 deposit which I'm told refundable. I will make a decision by tomorrow.
Below are the numbers for 36 month PCP.
Invoice price : £35,875
P/X : £13,000
Cash deposit : £0
Amount financed : £22,875
Final rental : £16,933.75
PCP term : 37 months
Annual mileage : 8,000 (Excess = 6p/mile)
Inclusive rental : £284.14
Brand new Black manual S3 with B&0, tech pack. Tempted but this will be my first PCP.
Below are the numbers for 36 month PCP.
Invoice price : £35,875
P/X : £13,000
Cash deposit : £0
Amount financed : £22,875
Final rental : £16,933.75
PCP term : 37 months
Annual mileage : 8,000 (Excess = 6p/mile)
Inclusive rental : £284.14
Brand new Black manual S3 with B&0, tech pack. Tempted but this will be my first PCP.
Little Lofty said:
As a comparison on a Golf R (which to be far isn't available now as the prices have risen) I'm paying £290 per month on a 24 month PCP, on top of that is a £1500 deposit. I did look at the S3 but at the time the monthly was around £400 with a similar deposit. The Golf prices are now closer to the S3, just make sure you get a good discount on the S3, Drive The Deal were doing around 10% last time I looked, any dealer can match that if they want to.
Blimey that's a cracking deal! You are right it will cost around £400+/month with a £3k deposit. No discount given at all on the S3 but it does come with loaded with the right toys. Must've been a cancelled order.Muzzer79 said:
It doesn't seem great to me
I did a pcp once, but imo they only work well if you drop in a low deposit. I paid £18k at the time, but only laid in a £1k deposit. The GFV was also reassuringly low, meaning it was economic for me to extend and own the car.
At the moment, you own a £13k car outright. You are about to do a deal to chop that in for a car that will cost you nearly £300 a month and in 3 years you'll then have to pay another £15k to own it.......
If you must do it this way, I would spend the £35k on a used M3/911 or something, rather than an S3....
I did use to own a E92 M3 once, cracking car but costly to maintain. I did a pcp once, but imo they only work well if you drop in a low deposit. I paid £18k at the time, but only laid in a £1k deposit. The GFV was also reassuringly low, meaning it was economic for me to extend and own the car.
At the moment, you own a £13k car outright. You are about to do a deal to chop that in for a car that will cost you nearly £300 a month and in 3 years you'll then have to pay another £15k to own it.......
If you must do it this way, I would spend the £35k on a used M3/911 or something, rather than an S3....
I do realise this is a bad financial decision as I'm putting myself into negative equity but part of me wants a nice new car...
General consensus seems to agree that price quoted (which I worked out to be around 7.1& APR) seems about normal without any dealer discounts.
It's just not very wise to throw 13k equity plus monthly payments into a PCP of a car retailing at £35k...
Sheepshanks said:
What do you intend to do at the end? If you're going to keep it then haven't you already established that straight HP will be a couple of £K cheaper?
To be honest I have no intentions of keeping it. I admit I'm a serial car changer just never really explored the PCP option.I'm looking at the 3 year PCP because it gives me enough time to save up for next car and also to time it before manufacturer's warranty runs out.
jw673 said:
In which case/if you'll be returning it to Audi finance at the end of the PCP - over the term, including writing off the £13,000 PX as you're returning the car and (*if*) any equity is irrelevant, @~3.6% Flat/~7.37% APR it will have cost you ~£646 a month for the use of the vehicle (i.e. total/36).
If ignoring the PX and just taking the £284 monthly - over the term this works out at an average of ~£119 in interest and ~£165 in depreciation, per month.
http://www.carfile.net/business/audi-a3-s3_tfsi_qu... shows discounts available on the S3 - I'm not sure why you're happy to pay what appears to be list price(?) for an in-stock car? This is what PCPs are good for - having the customer concentrate on the "monthly" as opposed to the basics, in your case: the price of the car and the value of the PX. How you best fund it once you've finalised those details are open to (endless, on PH) debate.
crazy about cars - see email re: PCP spreadsheet
Note: the above is based on 36 months
Thank you so much for your analysis so far jw673. I will check my PH email later.If ignoring the PX and just taking the £284 monthly - over the term this works out at an average of ~£119 in interest and ~£165 in depreciation, per month.
http://www.carfile.net/business/audi-a3-s3_tfsi_qu... shows discounts available on the S3 - I'm not sure why you're happy to pay what appears to be list price(?) for an in-stock car? This is what PCPs are good for - having the customer concentrate on the "monthly" as opposed to the basics, in your case: the price of the car and the value of the PX. How you best fund it once you've finalised those details are open to (endless, on PH) debate.
crazy about cars - see email re: PCP spreadsheet
Note: the above is based on 36 months
There are a few options on the car I'm looking at such as B&O, black optics pack, tech pack etc but to be fair I've not got a complete list of options which I've requested. The price including options as in screenshot is given as almost £36k.
I've also requested to see if it's possible to put down £5,000 deposit and have £8,000 cashback and will see how that will affect the monthly and GFV figures.
Thanks for all the advice chaps - really appreciate it.
I believe I've been blinded by the fact that I can have a new toy before Christmas without thinking of the longer term implications.
From what I can understand the car is worth £36,000 retail now and assuming at the end of 3 year I want to keep the car I pay around £4,000 (40k total) interest assuming I can fork out the balloon of 16k. If I don't I've lost £21,000 (13k as valued for my current car + 8k rental and that's not inclusive of the 3k I've lost in the 3 months of ownership).
Fired a few questions and will see what replies I get tomorrow but otherwise I do think it's a very costly Christmas present indeed. Just hope I would get my deposit back...
I believe I've been blinded by the fact that I can have a new toy before Christmas without thinking of the longer term implications.
From what I can understand the car is worth £36,000 retail now and assuming at the end of 3 year I want to keep the car I pay around £4,000 (40k total) interest assuming I can fork out the balloon of 16k. If I don't I've lost £21,000 (13k as valued for my current car + 8k rental and that's not inclusive of the 3k I've lost in the 3 months of ownership).
Fired a few questions and will see what replies I get tomorrow but otherwise I do think it's a very costly Christmas present indeed. Just hope I would get my deposit back...
Thanks again all for the helpful advise.
I've asked for a revised figure based on deposit of £5k (£8k refunded), 8,000 miles/year 3 year PCP . Will see how the monthly payments are. Worse case I was told that my £1,000 deposit will be refunded, otherwise the car will be PDI'ed, registered and delivered to me before Christmas.
Regarding the specs it's as below (only thing missing from my wish list is sunroof but to be honest it's not a deal breaker):
S3 3 door 6 speed manual in Panther black
Bang & Olufsen
Black styling package
Technology package with Audi connect
Comfort package
Privacy glass
Red brake calipers
Black inlays
I've asked for a revised figure based on deposit of £5k (£8k refunded), 8,000 miles/year 3 year PCP . Will see how the monthly payments are. Worse case I was told that my £1,000 deposit will be refunded, otherwise the car will be PDI'ed, registered and delivered to me before Christmas.
Regarding the specs it's as below (only thing missing from my wish list is sunroof but to be honest it's not a deal breaker):
S3 3 door 6 speed manual in Panther black
Bang & Olufsen
Black styling package
Technology package with Audi connect
Comfort package
Privacy glass
Red brake calipers
Black inlays
Wills2 said:
I cannot see the sense in putting 13k cash into a 35k car to not own it at the end, and then on top of that not getting any discount on a manual S3 (surely that market will prefer the DSG)
I wouldn't put down anymore than 10% and I'd be looking for 5% APR and a discount.
You can get an S3 for 2.5k down and £360 a month on PCH.....
http://www.contracthire-audi.co.uk/audi_s-rs_contr...
Manual is my personal preference as I had a 6 speed MKII TT which was fun. The new engine is rated at 300PS so it will be even better I wouldn't put down anymore than 10% and I'd be looking for 5% APR and a discount.
You can get an S3 for 2.5k down and £360 a month on PCH.....
http://www.contracthire-audi.co.uk/audi_s-rs_contr...
I'm happy to know that Audi Finance offers S3 for just £2.5k deposit and 360/month! My long term plan (assuming I can afford) is to continue getting a new car every 3 years on PCP with Audi. To me that's new car every 3 years with minimal cost to change and cost to run over the duration. Makes sense?
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