Are the wheels about to fall of car finance?
Discussion
s m said:
If you (roughly) adjust for inflation, you can get a brand new Mondeo for 24 months and 24,000 miles for £195 (in today’s money) per month with a similarly adjusted balloon payment.
Edit: ballsed up quoting on phone.
Edited by horsemeatscandal on Friday 8th November 14:17
Edited by horsemeatscandal on Friday 8th November 14:19
horsemeatscandal said:
Cars are cheap now, eh?
If you (roughly) adjust for inflation, you can get a brand new Mondeo for 24 months and 24,000 miles for £195 (in today’s money) per month with a similarly adjusted balloon payment.
The deposit on that Mondeo deal would be £7285 in todays money with monthly payments of £386.18.If you (roughly) adjust for inflation, you can get a brand new Mondeo for 24 months and 24,000 miles for £195 (in today’s money) per month with a similarly adjusted balloon payment.
List price in todays money would be £23,152.
Deep Thought said:
The deposit on that Mondeo deal would be £7285 in todays money with monthly payments of £386.18.
List price in todays money would be £23,152.
Okay I may be wrong, I just looked quickly on my phone as £215 seemed expensive. I assumed it was a ~1995 car so according to the BoE calculator that deposit is £7695 in today’s (okay, 2018’s) money. List price in todays money would be £23,152.
Stick that on a Zetec Mondeo today over the same miles/time and Ford’s calculator is showing £195 with a final payment of £9090 which is £4813 in 1995 (as opposed to £5439 in the ad). Unless I’ve missed something really obvious that seems Fantastic in comparison?
Granted, I have no idea what the spec level of a Zetec is but I’m sure overall it’s better than a mid-90s Mondeo. Probably more airbags.
horsemeatscandal said:
Okay I may be wrong, I just looked quickly on my phone as £215 seemed expensive. I assumed it was a ~1995 car so according to the BoE calculator that deposit is £7695 in today’s (okay, 2018’s) money.
Stick that on a Zetec Mondeo today over the same miles/time and Ford’s calculator is showing £195 with a final payment of £9090 which is £4813 in 1995 (as opposed to £5439 in the ad). Unless I’ve missed something really obvious that seems Fantastic in comparison?
Granted, I have no idea what the spec level of a Zetec is but I’m sure overall it’s better than a mid-90s Mondeo. Probably more airbags.
Yes, there would be a general complaint that cars are more expensive these days but the reality is, once you factor in inflation they're usually in line with that OR cheaper. Plus, the cars of today are higher spec'd, have more safety features, are more economical etc.Stick that on a Zetec Mondeo today over the same miles/time and Ford’s calculator is showing £195 with a final payment of £9090 which is £4813 in 1995 (as opposed to £5439 in the ad). Unless I’ve missed something really obvious that seems Fantastic in comparison?
Granted, I have no idea what the spec level of a Zetec is but I’m sure overall it’s better than a mid-90s Mondeo. Probably more airbags.
Deep Thought said:
Yes, there would be a general complaint that cars are more expensive these days but the reality is, once you factor in inflation they're usually in line with that OR cheaper. Plus, the cars of today are higher spec'd, have more safety features, are more economical etc.
Sorry, I thought you’d disagreed with my original comment, hence why I ‘showed my working’. I guess maybe 20+ years ago PCP or similar was less mainstream and perhaps angled more towards the wealthier.
In response to a comment earlier, surely there are plenty of people on £30k who are happy to PCP a car? £30k is a good wage in a lot of places and some finance deals can’t be far off double figures, for say something like a C1, Aygo or similar?
horsemeatscandal said:
In response to a comment earlier, surely there are plenty of people on £30k who are happy to PCP a car? £30k is a good wage in a lot of places and some finance deals can’t be far off double figures, for say something like a C1, Aygo or similar?
Coupled with the fact most families have two incomes now - a spend of a couple of hundred or so on a car isnt much of a hardship each month.Wooda80 said:
I trust that as a consequence of your financial recklessness you are now living in a cardboard box under a bridge ( or maybe out of the back of your latest leased Audi ) 
Life lessons for young people reading this thread aka Finance bragging post:my first pcp = after 4 years, randomly received a £8000 cheque from Porsche finance for all interest charge refunded due to admin legal error. Went to vegas with proceeds.
my second pcp = after 911 turbo for 3 years and 50k miles was given a £25k cheque as value of car had increased. Went to vegas with proceeds.
Did not make double payments on mortgage.
(hopes better half is not reading this thread).
gizlaroc said:
Haha, thinking back it was actually 1998 when I bought it, it was 3 years old from memory.
N189 SPM, cloth seats, no air con, 1.9tdi non red i so a massive 90hp.
In all honesty, if I hadn't wasted so much on cars over the years I could have had a decent pension by now and probably been able to retire at 55, no chance of that now.
Yes but the neighbours are never impressed about pensions they can’t see....N189 SPM, cloth seats, no air con, 1.9tdi non red i so a massive 90hp.
In all honesty, if I hadn't wasted so much on cars over the years I could have had a decent pension by now and probably been able to retire at 55, no chance of that now.
Deep Thought said:
Thought this was of interest.
Its an advert from a local newspaper that i found here, dated 3rd July 2003 - some 16+ years ago.
Interesting in that all those cars are advertised as a deposit plus monthly payment.
Some would have us believe thats a new thing.
Credit has been around since Adam was a lad, I have no idea why some PH'ers think it's something new....Its an advert from a local newspaper that i found here, dated 3rd July 2003 - some 16+ years ago.
Interesting in that all those cars are advertised as a deposit plus monthly payment.
Some would have us believe thats a new thing.
Wills2 said:
Credit has been around since Adam was a lad, I have no idea why some PH'ers think it's something new....
And it'll be around helping people to buy vehicles for quite some time yet, so the wheel aren't about to fall of per se. Finance products available to retail consumers, interest rates, residual values and preferred funding methods may change, but the general tendency to finance rather than save up and buy outright years later aren't changing any time soon it seems.
HP migrated to PCP, PCP is migrating to personal leasing/contract hiring and eventually that'll migrate to a non-ownership, rental per use model, which will be the most significant deviation.
Dr Jekyll said:
HP and loans or savings are still the norm for used cars.
Sub £10k used cars maybe. Main dealer used stock at up to 3-5 years old is still PCP eligible, so tends to go out on that. Likewise for independent traders, PCP often available now for vehicles up to 10 years old if the mileage will be under 80k at end of term. Very little HP sold on used at all. Loans/savings more common for generally older, cheaper stuff.4941cc said:
Dr Jekyll said:
HP and loans or savings are still the norm for used cars.
Sub £10k used cars maybe. Main dealer used stock at up to 3-5 years old is still PCP eligible, so tends to go out on that. Likewise for independent traders, PCP often available now for vehicles up to 10 years old if the mileage will be under 80k at end of term. Very little HP sold on used at all. Loans/savings more common for generally older, cheaper stuff.Zopa is getting more into car finance
It commissioned research that shows many people don’t understand the detail of car finance.
Whether they need to understand the detail, or not, is another question
https://www.p2pfinancenews.co.uk/2019/10/09/zopa-b...
It commissioned research that shows many people don’t understand the detail of car finance.
Whether they need to understand the detail, or not, is another question
https://www.p2pfinancenews.co.uk/2019/10/09/zopa-b...
JPJPJP said:
Zopa is getting more into car finance
It commissioned research that shows many people don’t understand the detail of car finance.
Whether they need to understand the detail, or not, is another question
https://www.p2pfinancenews.co.uk/2019/10/09/zopa-b...
The Zopa article in the link claims that "The vast majority – nine in 10 – were unable to pick out the lowest-cost option."It commissioned research that shows many people don’t understand the detail of car finance.
Whether they need to understand the detail, or not, is another question
https://www.p2pfinancenews.co.uk/2019/10/09/zopa-b...
That's not surprising given how ambiguous Zopa's example is.
The table contains a column headed "Total Cost" so clearly the one with the lowest figure in that column should be ( and is ) the lowest cost option. But it's not the one with the lowest interest rate, rather it's the one with the smallest finance balance, so it's not the option with the lowest cost of finance.
More confusingly the table is titled "Choosing the best car finance deal..." The best car finance deal is the one which provides the lowest cost solution taking into account the amount available as a deposit, the desired monthly payment, the length of time the car is to be kept and whether or not you wish to have an interest in the car's value at the end of the agreement The best deal for me will probably be different to the one that's best for you.
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