Financing super/sports cars in the £70-90k range

[Wololo]

Hi,

Basically, I'm looking to find out what methods people are using to finance things like 570s, Vantages or California Ts. Is it all just HP/Bank loans and cash, or is PCP still available despite many of these cars being a bit too old for most lenders to offer PCP?

And has anyone been able to get better than 8.9% in the current environment?

Apologies for coming across a total noob - this is an area of the market I've never played in, so I am! I know I could ring a couple of lenders and ask, but I'd be keen to get a less biased view from the PH regulars before getting in touch with them.

Thanks!

[Jiebo]

Do people finance these? I sort of get PCP for new cars, as all people see are the monthlies and the retail price is irrelevant.

But I'd imagine the sort of person spending almost 100 grand on a used car would have surplus cash to splash, rather than take up loans to buy a depreciating asset they cant afford.

[Wololo]

Jiebo said:

Do people finance these? I sort of get PCP for new cars, as all people see are the monthlies and the retail price is irrelevant.

But I'd imagine the sort of person spending almost 100 grand on a used car would have surplus cash to splash, rather than take up loans to buy a depreciating asset they cant afford.

Are 570s depreciating? Seem annoyingly solid to me.

[Gnevans]

Forza finance were 7.9%

[samoht]

There's a whole industry of financing these sorts of cars I think, many of whom advertise on the big YT channels like Harry's Garage, JayEmm on Cars etc. Typically they loan you the money with relatively low monthly payments and a high final (balloon) payment, crucially you are taking the risk on the car's value at end of term (unlike PCP).


Lots more discussion here https://www.pistonheads.com/gassing/topic.asp?h=0&...

[bennno]

Jiebo said:

Do people finance these? I sort of get PCP for new cars, as all people see are the monthlies and the retail price is irrelevant.

But I'd imagine the sort of person spending almost 100 grand on a used car would have surplus cash to splash, rather than take up loans to buy a depreciating asset they cant afford.

Oddly, broadly speaking pcp is terrible for new cars and better suited to used.

Pre depreciated cars will likely have stronger residuals once they’ve been pre depreciated as opposed to brought new.

Many lenders won’t put pcp balloons on older vehicles / vehicles older than 7-8 years.

I’d suggest it’s easiest to get 40-50% deposit together and HP the rest if needed - but dealers will guide.

[Edible Roadkill]

Buy cash and then repay personal finances instead? Arguments for and against doing so but the biggest being for me being I’d only resent ownership more if it was costing me £xxxx per month when I seldom use it! As you generally do with these cars. I don’t know one person that daily’s a supercar.

Think it was JayZ once said If you can’t afford to buy it twice then you really can’t afford it. It’s not terrible advice.

[GG89]

Edible Roadkill said:

Buy cash and then repay personal finances instead? Arguments for and against doing so but the biggest being for me being I’d only resent ownership more if it was costing me £xxxx per month when I seldom use it! As you generally do with these cars. I don’t know one person that daily’s a supercar.

Think it was JayZ once said If you can’t afford to buy it twice then you really can’t afford it. It’s not terrible advice.

It is terrible advice, akin to if you have to ask the price you can't afford it. Utter bks.

[fflump]

Jiebo said:

Do people finance these? I sort of get PCP for new cars, as all people see are the monthlies and the retail price is irrelevant.

But I'd imagine the sort of person spending almost 100 grand on a used car would have surplus cash to splash, rather than take up loans to buy a depreciating asset they cant afford.

People finance all sorts of things for all sorts of reasons. Their money may be tied up in other assets or have an opportunity cost that is greater than the finance option. They may be soon due a work bonus or other lump sum. They may have a salary with a substantial surplus to spend on discretionary items and choose not to wait. The idea that someone who cannot buy a car in cash cannot afford it is an overly simplistic viewpoint.

[DexterMorgan]

Wololo said:

Hi,

Basically, I'm looking to find out what methods people are using to finance things like 570s, Vantages or California Ts. Is it all just HP/Bank loans and cash, or is PCP still available despite many of these cars being a bit too old for most lenders to offer PCP?

And has anyone been able to get better than 8.9% in the current environment?

Apologies for coming across a total noob - this is an area of the market I've never played in, so I am! I know I could ring a couple of lenders and ask, but I'd be keen to get a less biased view from the PH regulars before getting in touch with them.

Thanks!

We see mostly lease purchase with a balloon. This works like a PCP on paper but without the mileage limitations and the guaranteed future value as it's just a deferred larger payment. So, if you are looking at keeping it a couple of years and then changing it this may work for you. Asset funders can also help. There are solutions out there for cars to a certain age.

[Crumpet]

When I was looking earlier in the year I was quite surprised how reasonable some of the PCP quotes were on some pretty tasty stuff, particularly if you managed to find something where the residual value figure was high. Of course ‘reasonable’ is a relative term but £800 a month doesn’t even cover some Volvos these days so for a £100k sports car it seemed pretty ok.

That being said, 10% per year on interest alone on a fairly big number (like £70k) just didn’t sit well with me. In the end I couldn’t stomach PCP and - probably foolishly - emptied my savings instead .

One option you could consider would be adding it to your mortgage on 4% or so? Seems the cheapest way to borrow these days.

[fflump]

Crumpet said:

When I was looking earlier in the year I was quite surprised how reasonable some of the PCP quotes were on some pretty tasty stuff, particularly if you managed to find something where the residual value figure was high. Of course ‘reasonable’ is a relative term but £800 a month doesn’t even cover some Volvos these days so for a £100k sports car it seemed pretty ok.

That being said, 10% per year on interest alone on a fairly big number (like £70k) just didn’t sit well with me. In the end I couldn’t stomach PCP and - probably foolishly - emptied my savings instead .

One option you could consider would be adding it to your mortgage on 4% or so? Seems the cheapest way to borrow these days.

Yes if you have headroom in your mortgage that is always going to be the cheapest way to finance as long as you’re disciplined enough to pay the car loan component off in the timeframe of a normal car loan. Certainly doesn’t make sense paying interest on it for 25 years!