Need Advice on PCP - new to this site!
Discussion
babatunde said:
Northernsoul01 said:
Hi - apologies I'm new to this site and need some advice on my current 4 year PCP deal. I drive an Audi A5 coupe and are two years in. My job has changed and I'm exceeding the mileage by a huge amount - e.g. Pcp on 12k a year and I m doing 25k. Obviously that doesn't matter I guess unless I'm planning to hand it back. My worry is that I have so much negative equity in it that I will never get out of the situation, do I hang on for another year? Roll it over now? I'm unsure as my mileage isn't going to change. Sorry for the naive post but I just want advice - as I said new to this PCP world.
If you are up for a fight google, voluntary termination, despite all the threats from finance companies none of them have taken a case to court ever.http://legalbeagles.info/forums/showthread.php?345... is a good starting point.
Edited by babatunde on Tuesday 1st August 15:30
Whilst a few thousand over agreed mileage isnt going to raise any eyebrows - or not enough to make it worth their while - a car being VT'd thats been to the moon and back might...
VT or handing the car back may or may not be a good deal, but the starting point is that it's the worst case scenario.
A 2013 A5 S-Line 2.0 TDi Black Edition with FSH and nav gets a WeBuyAnyCar price of £12,165 at 100k miles. (There's one on retail sale on eBay at £15k).
So if your hand back price at 50k miles is £15k and you have to pay 7ppm then your effective hand back price is less than selling it, and replacing it with a retail car would leave you in just as much negative equity.
It's hard to suggest anything without actual figures but your actual costs at this stage in the car's lifecycle are probably quite low.
A 2013 A5 S-Line 2.0 TDi Black Edition with FSH and nav gets a WeBuyAnyCar price of £12,165 at 100k miles. (There's one on retail sale on eBay at £15k).
So if your hand back price at 50k miles is £15k and you have to pay 7ppm then your effective hand back price is less than selling it, and replacing it with a retail car would leave you in just as much negative equity.
It's hard to suggest anything without actual figures but your actual costs at this stage in the car's lifecycle are probably quite low.
why do people feel entitled to things they cannot actually afford?
why buy something you cannot actually afford in a million years.
weird attitude.
ive bought my car on pcp but only as i get 0 apr and can make better use of that money in investments in the meantime for the term of the contract. i was going to buy it outright as thats what i have always done in the past, but decided to go with pcp as was persuaded by mates despite it being something i completely disagree with.
pcp should only exist if the buyer proves they can afford to buy it outright at the start and ring fences the costs of the pcp in some format for the duration. or something like that.
if i cant afford something, i dont buy it.
i dont get it on the never ever.
thats the trouble we face people want shiny new stuff yet cant afford it in a million years and post topics like this.
cant afford it, dont have it. harsh but fair.
pcp is like a subprime mortgage bubble in this country and will cause big issues soon.
why buy something you cannot actually afford in a million years.
weird attitude.
ive bought my car on pcp but only as i get 0 apr and can make better use of that money in investments in the meantime for the term of the contract. i was going to buy it outright as thats what i have always done in the past, but decided to go with pcp as was persuaded by mates despite it being something i completely disagree with.
pcp should only exist if the buyer proves they can afford to buy it outright at the start and ring fences the costs of the pcp in some format for the duration. or something like that.
if i cant afford something, i dont buy it.
i dont get it on the never ever.
thats the trouble we face people want shiny new stuff yet cant afford it in a million years and post topics like this.
cant afford it, dont have it. harsh but fair.
pcp is like a subprime mortgage bubble in this country and will cause big issues soon.
theplayingmantis said:
why do people feel entitled to things they cannot actually afford?
why buy something you cannot actually afford in a million years.
weird attitude.
ive bought my car on pcp but only as i get 0 apr and can make better use of that money in investments in the meantime for the term of the contract. i was going to buy it outright as thats what i have always done in the past, but decided to go with pcp as was persuaded by mates despite it being something i completely disagree with.
pcp should only exist if the buyer proves they can afford to buy it outright at the start and ring fences the costs of the pcp in some format for the duration. or something like that.
if i cant afford something, i dont buy it.
i dont get it on the never ever.
thats the trouble we face people want shiny new stuff yet cant afford it in a million years and post topics like this.
cant afford it, dont have it. harsh but fair.
pcp is like a subprime mortgage bubble in this country and will cause big issues soon.
fwhy buy something you cannot actually afford in a million years.
weird attitude.
ive bought my car on pcp but only as i get 0 apr and can make better use of that money in investments in the meantime for the term of the contract. i was going to buy it outright as thats what i have always done in the past, but decided to go with pcp as was persuaded by mates despite it being something i completely disagree with.
pcp should only exist if the buyer proves they can afford to buy it outright at the start and ring fences the costs of the pcp in some format for the duration. or something like that.
if i cant afford something, i dont buy it.
i dont get it on the never ever.
thats the trouble we face people want shiny new stuff yet cant afford it in a million years and post topics like this.
cant afford it, dont have it. harsh but fair.
pcp is like a subprime mortgage bubble in this country and will cause big issues soon.
k me 
Did you really just post that to smash up the PH Cliche bingo challenge? I think that's almost a full card in one post
theplayingmantis said:
i was going to buy it outright as thats what i have always done in the past, but decided to go with pcp as was persuaded by mates despite it being something i completely disagree with.
So your mates influenced your decision so much that you went against everything you believe in ?Did they drag you down to the dealership at gun point or something ?
juice said:
theplayingmantis said:
i was going to buy it outright as thats what i have always done in the past, but decided to go with pcp as was persuaded by mates despite it being something i completely disagree with.
So your mates influenced your decision so much that you went against everything you believe in ?Did they drag you down to the dealership at gun point or something ?
people will defend pcp and the never ever culture, and im hypocrtyical as ive used it per the above. but the fact is that pcp for the majority of people is a potential time bomb. pcp is designed for people who cannot afford what they want. hopefully interest rates will rise soon (i know they wont which messes those of us without mortgages and large cash reserves up) and it will help put a stop to this and ease people out of the pcp cycle.
those who vehmenetly defend its use are those who dont like to face facts they arent entitled to something they cannot afford, and really must keep up with the joneses. likewise those who say they can get 10% returns on their investment. they cannot risk free. if you get 0-2% apr on a pcp then yes you can get guaranteed better returns, anything more and you will be struggling (no a fund is not a guaranteed return)
at current rates pcp is fine and not a problem, but at some point rates will go up, and the pcp time bomb and consumer debt will cause a huge issue if it remains unchecked.
thats my beef.
i dont care what people drive, but having many friends who suffered after lehmann bros went down, and facing ignorant backlash against my profession as a result of the last recession, anything that can cause that on such a scale again in this country is a huge negative in my eyes, and those who claim current levels of consumer debt (a lot of it in car finance), are just burying their heads in the sand.
theplayingmantis said:
as im sitting in departures waiting to get a flight i will humor you! no but they pointed out a fixed term 'high yield' bond makes more sense than spunking 70k on a potential money trap alfa when i could get 0% pcp, i saw their point.
people will defend pcp and the never ever culture, and im hypocrtyical as ive used it per the above. but the fact is that pcp for the majority of people is a potential time bomb. pcp is designed for people who cannot afford what they want. hopefully interest rates will rise soon (i know they wont which messes those of us without mortgages and large cash reserves up) and it will help put a stop to this and ease people out of the pcp cycle.
those who vehmenetly defend its use are those who dont like to face facts they arent entitled to something they cannot afford, and really must keep up with the joneses. likewise those who say they can get 10% returns on their investment. they cannot risk free. if you get 0-2% apr on a pcp then yes you can get guaranteed better returns, anything more and you will be struggling (no a fund is not a guaranteed return)
at current rates pcp is fine and not a problem, but at some point rates will go up, and the pcp time bomb and consumer debt will cause a huge issue if it remains unchecked.
thats my beef.
i dont care what people drive, but having many friends who suffered after lehmann bros went down, and facing ignorant backlash against my profession as a result of the last recession, anything that can cause that on such a scale again in this country is a huge negative in my eyes, and those who claim current levels of consumer debt (a lot of it in car finance), are just burying their heads in the sand.
people will defend pcp and the never ever culture, and im hypocrtyical as ive used it per the above. but the fact is that pcp for the majority of people is a potential time bomb. pcp is designed for people who cannot afford what they want. hopefully interest rates will rise soon (i know they wont which messes those of us without mortgages and large cash reserves up) and it will help put a stop to this and ease people out of the pcp cycle.
those who vehmenetly defend its use are those who dont like to face facts they arent entitled to something they cannot afford, and really must keep up with the joneses. likewise those who say they can get 10% returns on their investment. they cannot risk free. if you get 0-2% apr on a pcp then yes you can get guaranteed better returns, anything more and you will be struggling (no a fund is not a guaranteed return)
at current rates pcp is fine and not a problem, but at some point rates will go up, and the pcp time bomb and consumer debt will cause a huge issue if it remains unchecked.
thats my beef.
i dont care what people drive, but having many friends who suffered after lehmann bros went down, and facing ignorant backlash against my profession as a result of the last recession, anything that can cause that on such a scale again in this country is a huge negative in my eyes, and those who claim current levels of consumer debt (a lot of it in car finance), are just burying their heads in the sand.
I partly agree with you, however most people buy their cars on pcp but if they actually looked at it most of them would be better off with a lease. The ones that cause concern are those that keep changing after 2 years and roll negative equity into the next car. But dealers must share some responsibility for that.
However providing people understand it's dead money and that big deposits result in no money at the end and treat it as never owning the car then surely the biggest risk is to the manufacturers and lenders and ultimately the used car market.
My current car is on PCP because a PCP suited me. It's the first time I have PCP'd and it may be the last or the first of more - it all depends.
It's a 4 year term that ends next April and has been great for me - the cash I was going to spend on a car went into finishing my self build and the £200 a month, which includes servicing, has never even been noticed.
The main thing is going in with eyes open and understanding your exposure. If you do that then it can be a perfect way to purchase (as can leasing).
Where a lot of people get stung is believing that the GFV is a guaranteed value rather than a fixed payment at the end.
As in all aspects of life, horses for courses.
It's a 4 year term that ends next April and has been great for me - the cash I was going to spend on a car went into finishing my self build and the £200 a month, which includes servicing, has never even been noticed.
The main thing is going in with eyes open and understanding your exposure. If you do that then it can be a perfect way to purchase (as can leasing).
Where a lot of people get stung is believing that the GFV is a guaranteed value rather than a fixed payment at the end.
As in all aspects of life, horses for courses.
theplayingmantis said:
why do people feel entitled to things they cannot actually afford?
why buy something you cannot actually afford in a million years.
weird attitude
What is weird to me is people proclaiming you "can't afford" something even though you clearly CAN afford the various terms of the finance agreement... saying they can't afford it because they don't have the (irrelevant) sticker price sat in the bank in cash is much like me proclaiming you can't afford your car because you don't have 5x the sticker price sat in the bank - it's a purely arbitrary figure that nobody is actually paying at any point. why buy something you cannot actually afford in a million years.
weird attitude
Venturist said:
theplayingmantis said:
why do people feel entitled to things they cannot actually afford?
why buy something you cannot actually afford in a million years.
weird attitude
What is weird to me is people proclaiming you "can't afford" something even though you clearly CAN afford the various terms of the finance agreement... saying they can't afford it because they don't have the (irrelevant) sticker price sat in the bank in cash is much like me proclaiming you can't afford your car because you don't have 5x the sticker price sat in the bank - it's a purely arbitrary figure that nobody is actually paying at any point. why buy something you cannot actually afford in a million years.
weird attitude
ks anyway. As we've seen on this thread, many use PCP as it suits them in the circumstances, not because they have no cash.It would also imply that only those with a few hundred thousand in the bank should be allowed to buy a property.
Lots of very big and wrong assumptions being made.
garyhun said:
Venturist said:
theplayingmantis said:
why do people feel entitled to things they cannot actually afford?
why buy something you cannot actually afford in a million years.
weird attitude
What is weird to me is people proclaiming you "can't afford" something even though you clearly CAN afford the various terms of the finance agreement... saying they can't afford it because they don't have the (irrelevant) sticker price sat in the bank in cash is much like me proclaiming you can't afford your car because you don't have 5x the sticker price sat in the bank - it's a purely arbitrary figure that nobody is actually paying at any point. why buy something you cannot actually afford in a million years.
weird attitude
ks anyway. As we've seen on this thread, many use PCP as it suits them in the circumstances, not because they have no cash.It would also imply that only those with a few hundred thousand in the bank should be allowed to buy a property.
Lots of very big and wrong assumptions being made.
theplayingmantis said:
why do people feel entitled to things they cannot actually afford?
why buy something you cannot actually afford in a million years.
weird attitude.
ive bought my car on pcp but only as i get 0 apr and can make better use of that money in investments in the meantime for the term of the contract. i was going to buy it outright as thats what i have always done in the past, but decided to go with pcp as was persuaded by mates despite it being something i completely disagree with.
pcp should only exist if the buyer proves they can afford to buy it outright at the start and ring fences the costs of the pcp in some format for the duration. or something like that.
if i cant afford something, i dont buy it.
i dont get it on the never ever.
thats the trouble we face people want shiny new stuff yet cant afford it in a million years and post topics like this.
cant afford it, dont have it. harsh but fair.
pcp is like a subprime mortgage bubble in this country and will cause big issues soon.
And there it is...the ultimate PH answer why buy something you cannot actually afford in a million years.
weird attitude.
ive bought my car on pcp but only as i get 0 apr and can make better use of that money in investments in the meantime for the term of the contract. i was going to buy it outright as thats what i have always done in the past, but decided to go with pcp as was persuaded by mates despite it being something i completely disagree with.
pcp should only exist if the buyer proves they can afford to buy it outright at the start and ring fences the costs of the pcp in some format for the duration. or something like that.
if i cant afford something, i dont buy it.
i dont get it on the never ever.
thats the trouble we face people want shiny new stuff yet cant afford it in a million years and post topics like this.
cant afford it, dont have it. harsh but fair.
pcp is like a subprime mortgage bubble in this country and will cause big issues soon.
Put aside the cost of the extra mileage charge from your company mileage allowance minus any fuel you have to pay.
It may be you are actually in profit because you are doing more miles.
Do the sums, then you will see where you stand. If you are then sensible with the money and put that into a savings account you can stop worrying about it.
You are entitled to 45p per mile tax free for the first 10K business miles, 25p per mile for any extra business miles above this initial 10K tax free, if the employer pays you more than this rate, that additional amount is taxable.
How this works for you will depend on the terms of your deal and how much fuel you use.
It may be you are actually in profit because you are doing more miles.
Do the sums, then you will see where you stand. If you are then sensible with the money and put that into a savings account you can stop worrying about it.
You are entitled to 45p per mile tax free for the first 10K business miles, 25p per mile for any extra business miles above this initial 10K tax free, if the employer pays you more than this rate, that additional amount is taxable.
How this works for you will depend on the terms of your deal and how much fuel you use.
daemon said:
Granfondo said:
It's funny how someone can read a post and pick out all the bits that they can twist to suit their argument which in fact bares no resemblance to what was in fact written!
Oh fk me pink.Theres the kettle calling the pot black.
Oh and by the way, no thanks on your kind offer!
Edited by Granfondo on Sunday 13th August 19:11
Gassing Station | Car Buying | Top of Page | What's New | My Stuff