Pcp annual mileage
Discussion
Wonder if the finance gurus could answer a question I've got on the annual mileage when you take out a pcp finance package .
Been looking at a new M3 and the salesman stated that the annual mileage limit on pcp does not matter as if you px it or sell it privately, it only matters if you hand the car back. The difference between 10000 miles pa and 15000 miles is about £2500 on the GFV. It sort makes sense but will it have any effect on the equity left in the car when you px it ?
Been looking at a new M3 and the salesman stated that the annual mileage limit on pcp does not matter as if you px it or sell it privately, it only matters if you hand the car back. The difference between 10000 miles pa and 15000 miles is about £2500 on the GFV. It sort makes sense but will it have any effect on the equity left in the car when you px it ?
rs4al said:
Wonder if the finance gurus could answer a question I've got on the annual mileage when you take out a pcp finance package .
Been looking at a new M3 and the salesman stated that the annual mileage limit on pcp does not matter as if you px it or sell it privately, it only matters if you hand the car back. The difference between 10000 miles pa and 15000 miles is about £2500 on the GFV. It sort makes sense but will it have any effect on the equity left in the car when you px it ?
When you PX they will bid you in the balls irrespective of mileage! Been looking at a new M3 and the salesman stated that the annual mileage limit on pcp does not matter as if you px it or sell it privately, it only matters if you hand the car back. The difference between 10000 miles pa and 15000 miles is about £2500 on the GFV. It sort makes sense but will it have any effect on the equity left in the car when you px it ?
rs4al said:
Wonder if the finance gurus could answer a question I've got on the annual mileage when you take out a pcp finance package .
Been looking at a new M3 and the salesman stated that the annual mileage limit on pcp does not matter as if you px it or sell it privately, it only matters if you hand the car back. The difference between 10000 miles pa and 15000 miles is about £2500 on the GFV. It sort makes sense but will it have any effect on the equity left in the car when you px it ?
Yes, the mileage only matters if you exercise your right to hand the car back at the end of the agreement, In which case if you've gone over your mileage allowance you'll be charged X pence per mile for every mile you're over, of imagine over 10p a mile on an M3.Been looking at a new M3 and the salesman stated that the annual mileage limit on pcp does not matter as if you px it or sell it privately, it only matters if you hand the car back. The difference between 10000 miles pa and 15000 miles is about £2500 on the GFV. It sort makes sense but will it have any effect on the equity left in the car when you px it ?
I'd go for the higher mileage option if you can afford the payments so you're in the best position at the end of the agreement.
HTH
If you have the two GFVs, and the excess mileage charge, just calculate which is the cheaper option 
Slightly different but my current car is leased, I do around 13k pa, but it was cheaper to get it on a 10k miles agreement and pay the excess rather than a 12k or a 15k agreement. Plus if you end up coming in short you haven't been paying for something you won't get any use of.
Slightly different but my current car is leased, I do around 13k pa, but it was cheaper to get it on a 10k miles agreement and pay the excess rather than a 12k or a 15k agreement. Plus if you end up coming in short you haven't been paying for something you won't get any use of.
As mentioned above, the annual mileage is only pertinent if the finance company take possession of the vehicle, either if you exercise your right to terminate after 50% of the payments are made, or if you hand back at the end of the term. They may make a loss on disposal and have the right to charge the excess mileage as stated in your agreement.
But if you sell the car during the agreement, part exchange it for something else, or pay the balloon at the end, then the finance company have no interest in what mileage the vehicle has covered. Naturally with a higher balloon, you're deferring a large lump of the capital payable until the end of the term and will therefore pay more interest in total, and will have less equity at the end of the agreement.
If your intention would be to hand the vehicle back at the end of the term then I would suggest getting your mileage as accurate as possible.
But if you sell the car during the agreement, part exchange it for something else, or pay the balloon at the end, then the finance company have no interest in what mileage the vehicle has covered. Naturally with a higher balloon, you're deferring a large lump of the capital payable until the end of the term and will therefore pay more interest in total, and will have less equity at the end of the agreement.
If your intention would be to hand the vehicle back at the end of the term then I would suggest getting your mileage as accurate as possible.
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