Typical Finance Rates on New Porsches
Discussion
chazd said:
Pretty sure it’s around 5.9%.
Do you have a relationship with your local OPC? If not give Chris Dawson at Porsche Portsmouth and say Charles in the silver Cayenne have you his details. He may be able to offer something competitive??
at that rate, any reason why not finance by adding onto a home mortgage? rates are as low as 1.24% in this climate; 3yrs PCP payments are just to pay off the depreciation, plus interest on top.Do you have a relationship with your local OPC? If not give Chris Dawson at Porsche Portsmouth and say Charles in the silver Cayenne have you his details. He may be able to offer something competitive??
Obviously a totally personal choice, but I have always avoided funding cars via the mortgage route. The
temptation would be there to really go over the top and buy something exotic. Also, although the rates are much lower, it would be possible to lose discipline and have the extra funding hang around over an extended period, costing more interest over time.
I suspect a large number of cars bought ‘with cash’ are actually funded with equity released from the house. Each to their own, but my approach has always been that the LTV only moves in the ‘right’ direction.
Funding my car via a dedicated agreement keeps a lid on my budget, especially as I have a mental limit of repayments not exceeding 50% of my mortgage payment.
If you’re disciplined enough, the cost of credit in isolation via the mortgage route makes total sense though.
None of the above has stopped me making very daft decisions though when it comes to buying and selling my cars.
temptation would be there to really go over the top and buy something exotic. Also, although the rates are much lower, it would be possible to lose discipline and have the extra funding hang around over an extended period, costing more interest over time.
I suspect a large number of cars bought ‘with cash’ are actually funded with equity released from the house. Each to their own, but my approach has always been that the LTV only moves in the ‘right’ direction.
Funding my car via a dedicated agreement keeps a lid on my budget, especially as I have a mental limit of repayments not exceeding 50% of my mortgage payment.
If you’re disciplined enough, the cost of credit in isolation via the mortgage route makes total sense though.
None of the above has stopped me making very daft decisions though when it comes to buying and selling my cars.
PSB1 said:
Obviously a totally personal choice, but I have always avoided funding cars via the mortgage route. The
temptation would be there to really go over the top and buy something exotic. Also, although the rates are much lower, it would be possible to lose discipline and have the extra funding hang around over an extended period, costing more interest over time.
I suspect a large number of cars bought ‘with cash’ are actually funded with equity released from the house. Each to their own, but my approach has always been that the LTV only moves in the ‘right’ direction.
Funding my car via a dedicated agreement keeps a lid on my budget, especially as I have a mental limit of repayments not exceeding 50% of my mortgage payment.
If you’re disciplined enough, the cost of credit in isolation via the mortgage route makes total sense though.
None of the above has stopped me making very daft decisions though when it comes to buying and selling my cars.
Totally agree with that...mortgaging equity out of your home to buy a depreciating asset is not good in my opinion Yes it makes the monthly payments lower but a big part of that is because you’re taking on 25 years of debt vs 3 or 5. temptation would be there to really go over the top and buy something exotic. Also, although the rates are much lower, it would be possible to lose discipline and have the extra funding hang around over an extended period, costing more interest over time.
I suspect a large number of cars bought ‘with cash’ are actually funded with equity released from the house. Each to their own, but my approach has always been that the LTV only moves in the ‘right’ direction.
Funding my car via a dedicated agreement keeps a lid on my budget, especially as I have a mental limit of repayments not exceeding 50% of my mortgage payment.
If you’re disciplined enough, the cost of credit in isolation via the mortgage route makes total sense though.
None of the above has stopped me making very daft decisions though when it comes to buying and selling my cars.
Cheib said:
Totally agree with that...mortgaging equity out of your home to buy a depreciating asset is not good in my opinion Yes it makes the monthly payments lower but a big part of that is because you’re taking on 25 years of debt vs 3 or 5.
Agree with that statement ; however, whether you are financing say £100k via loan from mortgage or from alternative finance arrangement eg PCP is irrelevant. All that matters is the amount borrowed, length of debt & most importantly how much interest you are handing over to the loan-giver. ie Who you get the cash from is irrelevant.
If you calculate how much you would pay over 3yrs for say PCP, put that same amount into your mortgage & you will save - 1.24% vs 5%; ditto the balloon payment you would have made for the PCP, into your mortgage account.
What you are aiming for is the lowest interest on the market; PCP finance companies are just brokers who profit from the disparity.
£100k over 60 months at 1.4 vs 5.9 is roughly £200 a month saved.
So £1726 vs £1928.
Throwing another £200 a month into a £500k mortgage is going to knock a year off your 20 year mortgage.
Throwing another £200 a month into a £200k mortgage is going to knock three years off your 20 year mortgage.
I think I would go with some of the Porsche silly residuals, sometimes you know the car is not going to be worth that after 2-3 years.
But you are also paying off the capital of the car too.
I guess you would pay off the £100k as well, and be left with an asset worth £45k or so?
I think I would rather just leave the finance with the car. Throw the keys back worst case scenario.
So £1726 vs £1928.
Throwing another £200 a month into a £500k mortgage is going to knock a year off your 20 year mortgage.
Throwing another £200 a month into a £200k mortgage is going to knock three years off your 20 year mortgage.
I think I would go with some of the Porsche silly residuals, sometimes you know the car is not going to be worth that after 2-3 years.
But you are also paying off the capital of the car too.
I guess you would pay off the £100k as well, and be left with an asset worth £45k or so?
I think I would rather just leave the finance with the car. Throw the keys back worst case scenario.
Edited by gizlaroc on Thursday 12th September 19:44
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