BMW Finance Rates

[Brew]

Looking at BMW approved used M4s and the rates on PCP are all over the place. They seem to range from 5.9% to 10.9% - surely no one pays the latter? Who governs the rates, the dealers or BMW themselves? What are people's experiences when negotiating?

[paul789]

Brew said:

Looking at BMW approved used M4s and the rates on PCP are all over the place. They seem to range from 5.9% to 10.9% - surely no one pays the latter? Who governs the rates, the dealers or BMW themselves? What are people's experiences when negotiating?

It all depends on whether they think they can 'mug you off'. They'd charge 1900% APR if they could get away with it.

Explain that base rates are low, fixed interest is a joke, brokers will offer less than 6 and they'll soon move lower.

Clydesdale / Yorkshire bank are good; lower than 5% apr.

[PorkInsider]

Not from personal experience but from reading other forums (try M3Cutters) the rates can often be negotiated to some extent.

Yes, you can borrow money cheaply from elsewhere but if you want PCP with a GFV then it's not that easy. Some specialist lenders will do it though.

[Wills2]

I've never understood the APRs on their used cars, 10.9%? Who the hell would do that, it's almost like an insurance company quoting you a silly price because they don't want the business.

Edited by Wills2 on Friday 16th February 13:53

[snowley]

What you need to do, is agree to the ridiculous rate being provided by BMW - this will give you a greater scope for negotiation.

Then borrow from another lender once the deal is done and pay the remaining finance from the BMW loan with this.

Best way to get the best deal from the scenario, especially when loan rates are as low as 2.9% at the moment.....

[PorkInsider]

snowley said:

What you need to do, is agree to the ridiculous rate being provided by BMW - this will give you a greater scope for negotiation.

Then borrow from another lender once the deal is done and pay the remaining finance from the BMW loan with this.

Best way to get the best deal from the scenario, especially when loan rates are as low as 2.9% at the moment.....

Again, that's great if you only want a loan. Not if you want PCP.

[andyman_2006]

This is the problem when buying a used car on a PCP.

Low rates are often only offered on new cars, noticed bmw offering 0% on some M models, and 3.9% on others, it all depends on how many they want to shift, they often offer bigger 'deposit contribution' and lower rates on run out model cars like they did old M5.

It may be nearly as cheap to get a new (or built stock new M4) and haggle on a list price discount, take the 3.9% apr on PCP new.

I'm sure i've heard its also linked to the used vs new GFV, which affects the the balloon, and less backing on used car finance rates.

As some have said loans offer lowest rates right now, if your borrowing upto £25K then loan is cheapest at 2.9%, it all depends on your deposit amount i guess....PCP allows the low deposit and option to hand back if not keeping it, but loan means no finance attached and your free to sell anytime and it'll show hpi clean.

My Last PCP was on a new bmw 3.9% apr. check the offers page on bmw website.

Andy

[pjv997]

I recently bought a new M6 Gran Coupe.

I was looking at some approved used cars under 12 months old and also a pre-reg car. Quoted APR 5.9% on those.

My local dealer offered a new unregistered car at 0% finance and the total payments under the agreement including the balloon vs the pre-reg car were less than £1,000 difference.

So it's worth exploring a range of options.

I also helped my son negotiate a deal for an approved used 2 series recently. Initial quote was 10.9% APR which we negotiated to 8.9% I recall. With his limited credit history and only a 15% deposit, that probably wasn't a bad outcome.

[Eddieslofart]

Just got 3.9% on a used M4. Not used much mind (23 miles on it)

[Brew]

Eddieslofart said:

Just got 3.9% on a used M4. Not used much mind (23 miles on it)

Do you mind me asking which dealer?

Edited by Brew on Friday 16th February 18:54

[Eddieslofart]

Brew said:

Eddieslofart said:

Just got 3.9% on a used M4. Not used much mind (23 miles on it)

Do you mind me asking which dealer?

Edited by Brew on Friday 16th February 18:54

Cooper Chobam. But I did the deal through Colchester. They have a new pre reg M3 there at the mo. 18 k saving at 3.9% Thisun.

Edited by Eddieslofart on Saturday 17th February 15:14

[msdes123]

snowley said:

What you need to do, is agree to the ridiculous rate being provided by BMW - this will give you a greater scope for negotiation.

Then borrow from another lender once the deal is done and pay the remaining finance from the BMW loan with this.

Best way to get the best deal from the scenario, especially when loan rates are as low as 2.9% at the moment.....

If you’ve just been given a sizeable loan from the main BMW car finance and in a very short space of time try to take out another sizeable loan from another lender and before the BMW loan is paid off you can run into problems with your credit rating and it may not be as easy to just get the low APR loan as well before the BMW car finance is paid off.

I keep a subscription with Experian and check my record frequently with all my car financing activity. Whether I have taken out a loan or finance elsewhere in the last 6m shows up as a red alert negative factor on my rating report along with the amount of loan I already have outstanding. The BMW finance will show up on both these points on your credit rating when you apply for the cheap unsecured loan. If you were around the cut off for otherwise being accepted for the low APR unsecured loan taking out the BMW finance a month earlier will possibly tip you over into a “not accepted credit rating” I’m sure.

Just a point to be aware of from my own experience, not sure what others will say?

[wioifoiee]

msdes123 said:

If you’ve just been given a sizeable loan from the main BMW car finance and in a very short space of time try to take out another sizeable loan from another lender and before the BMW loan is paid off you can run into problems with your credit rating and it may not be as easy to just get the low APR loan as well before the BMW car finance is paid off.

I keep a subscription with Experian and check my record frequently with all my car financing activity. Whether I have taken out a loan or finance elsewhere in the last 6m shows up as a red alert negative factor on my rating report along with the amount of loan I already have outstanding. The BMW finance will show up on both these points on your credit rating when you apply for the cheap unsecured loan. If you were around the cut off for otherwise being accepted for the low APR unsecured loan taking out the BMW finance a month earlier will possibly tip you over into a “not accepted credit rating” I’m sure.

Just a point to be aware of from my own experience, not sure what others will say?

this was my question exactly - So how about doing it the other way around?
getting the cheap unsecured loan first, then doing a PCP deal with BMW, then using the loan to massively reduce the balance outstanding on the bmw finance deal?

or will the same thing happen - you get the unsecured loan, go to bmw, but then won't be able to get a decent bmw pcp APR due to the credit rating being affected from already have a bank loan?

[jon-yprpe]

The latter - they (manufacturer finance) do a credit check for the PCP as it’s also credit. As the other post said, Banks/finance cos don’t like lending money to pay off other debt, and they may move the apr rate anyway - it’s only ‘indicative’.

If you take PCP and then convert to a loan, all you have is a loan. So why not take it out in the first place to buy the car and negotiate a discount? I’m assuming you don’t mean you’d take a loan to pay the monthly PCP payments as that would be mad!


You can’t convert a loan to a ‘manufacturer’ PCP as the PCP is ’secured’ against the future value of the car.

Edited by jon-yprpe on Sunday 6th May 08:18

[wioifoiee]

jon-yprpe said:

I’m assuming you don’t mean you’d take a loan to pay the monthly PCP payments as that would be mad!

yes you're right, i don't mean taking a loan out to pay the monthly PCP payments (lol what would be the point) - i mean using the cheaper bank loan finance to pay off the bulk of the bmw finance immediately.

jon-yprpe said:

If you take PCP and then convert to a loan, all you have is a loan. So why not take it out in the first place to buy the car and negotiate a discount?

but that was my first query though - like the other guy, i was wondering - lets say i negotiate some sweet deal with BMW PCP on the sticker price of the car, with the intention of then getting the cheaper bank loan to pay it off (so just using the PCP as a way to lure the dealer into giving a discount).
if i were to get PCP first then go and get the bank loan, would i still be able to get the 3% APR bank loan or because of getting the PCP deal, it hits my credit score and i can't get a cheap bank loan anymore, thus negating what i was trying to achieve in the first place?!

[mikeyscott]

I enquired on a M2 recently for HP and they said 11.9% was only rate on offer. I said no thanks and know Hitachi Finance offer around 3% if not lower.

First thing dealer tried to do was put me in a new car on PCP

Edited by mikeyscott on Sunday 6th May 13:31

[anonymous-user]

No point making another thread so reviving this. Are dealers bending the rules? My understanding was that since the financial conduct authority stepped in, rates were fixed.

6.9% for AUC under 6 weeks old.
8.9% for everything else.

On the AUC listings there are 2017 plates going for 7.9% and some 2019 plates for 9.9%

Have dealers been given some sort of margin for discretion? Or are they continuing to play games and break rules?

[Cogito Ergo Sum]

The retailers are made to pick a rate by BMW FS at the start of the year, and can not deviate from this. They can set at 7.9, 8.9 or 9.9% hence the different rates between dealers.

[anonymous-user]

Cogito Ergo Sum said:

The retailers are made to pick a rate by BMW FS at the start of the year, and can not deviate from this. They can set at 7.9, 8.9 or 9.9% hence the different rates between dealers.

Makes sense. Thank you.

[Wills2]

The commission rates are fixed, so they can't charge more apr % to gain more commission, but they can and do offer different rates on different models hence BMWFS will offer 2.9% on a used 7 series but not on a used 3 series etc...

Dealers do not set the apr they are not lending the money, that was the issue the FCA sought to stop where the lenders were incentivising the dealers with a spread on the apr "sold" hence they could lend at 5.9 through to 9.9 and incentivised the dealer with larger kick backs at 9.9%

Edited by Wills2 on Tuesday 24th August 22:42