PCP Rates on Approved Used - Main Dealers
Discussion
Been looking at most main dealers at their PCP rates for approved used and most seem to be at 8.9% which is pretty terrible, are they all coercing with each other? I am sure 6.9% was widely available in the past which is slightly easier to stomach, although better than when BMW used to try 10.9% on and didn't even have the courtesy to at least dress up as bandits.
Has anyone in recent times had much success in negotiating on price or APR, any tips?
Has anyone in recent times had much success in negotiating on price or APR, any tips?
Yidwann said:
Been looking at most main dealers at their PCP rates for approved used and most seem to be at 8.9% which is pretty terrible, are they all coercing with each other? I am sure 6.9% was widely available in the past which is slightly easier to stomach, although better than when BMW used to try 10.9% on and didn't even have the courtesy to at least dress up as bandits.
Has anyone in recent times had much success in negotiating on price or APR, any tips?
A straightforward good old-fashioned bank loan is cheaper than this at the moment.Has anyone in recent times had much success in negotiating on price or APR, any tips?
M4cruiser said:
A straightforward good old-fashioned bank loan is cheaper than this at the moment.
True in terms of just the interest rate but if, like most people who take out PCP, you don’t intend to pay off the car at the end the higher dealer rate may still be more attractive. You will be financing a lower amount, albeit at a higher rate, and most probably still be paying less each month than a bank loan to drive the same car. If, however, you intend to pay off in full at the end and keep the car then absolutely a bank loan is much better value. In theory a bank loan also gives you an asset to sell at the end, unlike just walking away from a PCP. But again most people look at their monthly outgoings with mortgage etc, and nothing wrong with that as long as you go into it with your eyes open.
What percentage of people really do understand is a different issue.
Edited by TomTheTyke on Saturday 9th January 18:07
TomTheTyke said:
True in terms of just the interest rate but if, like most people who take out PCP, you don’t intend to pay off the car at the end the higher dealer rate may still be more attractive. You will be financing a lower amount, albeit at a higher rate, and most probably still be paying less each month than a bank loan to drive the same car.
If, however, you intend to pay off in full at the end and keep the car then absolutely a bank loan is much better value. In theory a bank loan also gives you an asset to sell at the end, unlike just walking away from a PCP. But again most people look at their monthly outgoings with mortgage etc, and nothing wrong with that as long as you go into it with your eyes open.
What percentage of people really do understand is a different issue.
You’re still financing the same amount, but you’re only paying off about half the principal over the term.If, however, you intend to pay off in full at the end and keep the car then absolutely a bank loan is much better value. In theory a bank loan also gives you an asset to sell at the end, unlike just walking away from a PCP. But again most people look at their monthly outgoings with mortgage etc, and nothing wrong with that as long as you go into it with your eyes open.
What percentage of people really do understand is a different issue.
You could get a bank loan over 6 years rather than a PCP, then pay off the remainder of the bank loan (by selling the car) at the end of the third year. That would give you a better deal with even lower repayments. The problem arises when you want to borrow over £25/30k - bank loans get more expensive.
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