Vanquish finance
Discussion
I’m half interested in an early 6 speed Vanquish from a main dealer - the grey one in Edinburgh at £100k.
On a 24m PCP, the balloon is set at £80k, so 80% of the price. I don’t have a crystal ball but IMO I think the 6 speed Vanquishes have some altitude to lose yet before levelling off. Therefore again IMO, after depreciation and the dealer’s margin, I wouldn’t see much if any of my deposit back after 2 years.
Then you look at a ~£80k V12V, a car which hopefully has just about fully bottomed out, and the balloon on one of those is set at about 60% after 2 years. Theoretically you might get a large proportion of your deposit back.
What’s going on here with these strategies? Why are they pushing used Vanquishes with these deals which to the short-sighted are extremely tempting indeed? A quick look at HowManyLeft shows roughly equal numbers of each model produced.
I’m most likely missing something extremely obvious here, car finance has always been a mystery to me.
On a 24m PCP, the balloon is set at £80k, so 80% of the price. I don’t have a crystal ball but IMO I think the 6 speed Vanquishes have some altitude to lose yet before levelling off. Therefore again IMO, after depreciation and the dealer’s margin, I wouldn’t see much if any of my deposit back after 2 years.
Then you look at a ~£80k V12V, a car which hopefully has just about fully bottomed out, and the balloon on one of those is set at about 60% after 2 years. Theoretically you might get a large proportion of your deposit back.
What’s going on here with these strategies? Why are they pushing used Vanquishes with these deals which to the short-sighted are extremely tempting indeed? A quick look at HowManyLeft shows roughly equal numbers of each model produced.
I’m most likely missing something extremely obvious here, car finance has always been a mystery to me.
Balloon payments, dealer contribution, no deposit, zero interest rate, low monthly cost.
All that I know about PCP, is that people who used to buy a second hand Ford Escort, now have a brand new Mercedes-Benz on their driveway, every 3 years. That would be depreciating by about £7,000 each year.
I am also told that Mercedes-Benz UK, have increased their annual new car sales by a remarkable 100% during recent years.
It all appears too good to be true. Everyone seems to be a winner.
What is going on?
Is there any risk of financial trouble eventually?
Edited by Jon39 on Monday 21st January 11:43
soofsayer said:
I am having a similar dilemma on cars.
I take it the balloon is not a guaranteed future value?
If it’s PCP then it is. You can just hand the car backI take it the balloon is not a guaranteed future value?
It sounds like the OP knows this but of course if the balloon is set lower it’s good for the finance company rather then the buyer, you’re paying the loan down to that level. You might have some residual value in he car above the balloon but the lender is more protected
Setting the balloon higher increases the risk for the finance company but makes the monthly payments more attractive (were the interest rates similar?). I would have said losing £10k per annum on a Used Vanquish feels about right, I’d hope for a little less. But that sounds to me like the dealer trying to shift the car
A 40% drop in a Vantage sounds a bit on the conservative side. I’m guessing if you’re looking to minimise the monthly payments you might get a better deal.
One final point. Challenge the dealer finance guys for a better rate. They do load them and almost always have some wiggle room
Jon39 said:
Balloon payments, dealer contribution, no deposit, zero interest rate, low monthly cost.
All that I know about PCP, is that people who used to buy a second hand Ford Escort, now have a brand new Mercedes-Benz on their driveway, every 3 years. That would be depreciating by about £7,000 each year. I am also told that Mercedes-Benz UK, have increased their annual sales by a remarkable 100% during recent years.
It all appears too good to be true. Everyone seems to be a winner.
What is going on?
Is there any risk of financial trouble eventually?
We're just going through the dilemma now with replacing the family skip. I want to pay cash for a 3 year old box that can get knocked around without giving me any worries... and dealers hate it. They all appear to be geared up to shifting new boxes as rented items.
I went to the Audi garage yesterday and some well-spec'd A6's and Q-whatevers are well over £60k. Lovely things inside but they will be worth a worrying fraction in 5 years.
I'm not THAT old. I'm in IT so have to be used to subscription services for so many things. But I don't want to feel like I'm hiring a car from Hertz every time I look at the drive.
Rant over. Now... back to the original question... what was it again?
Edited by nickv8 on Monday 21st January 11:51
A V12VS at £48k seems very low to me (60% of £80k)? Even the very first cars that are now 9-10 years old still trade at £50-£60k as far as I can tell?
The Vanquish worth £80k in 2 years does seem a little optimistic, there are a few dropping to near that level now.... One at Leeds sold at an advertised £80k after being sat around for a very long time and reduced from originally over £100k from memory.
Completely agree about PCP 'non ownership' buying behaviour. I think it is mainly down to the low interest rate environment and the buy now pay later general malaise. Upside is that as a second hand car buyer there are usually always plenty of fish on the sea.
The Vanquish worth £80k in 2 years does seem a little optimistic, there are a few dropping to near that level now.... One at Leeds sold at an advertised £80k after being sat around for a very long time and reduced from originally over £100k from memory.
Completely agree about PCP 'non ownership' buying behaviour. I think it is mainly down to the low interest rate environment and the buy now pay later general malaise. Upside is that as a second hand car buyer there are usually always plenty of fish on the sea.
I’m sure the OP would prefer this not to become a ranty thread about PCP and how things were different in our day. There’s more than enough of those in General chat
If he can afford the payments then there’s no reason for us to question his life choices or indeed anyone else who can afford to “lease” a Vantage now that interest rates are so low
If he can afford the payments then there’s no reason for us to question his life choices or indeed anyone else who can afford to “lease” a Vantage now that interest rates are so low
RobDown said:
I’m sure the OP would prefer this not to become a ranty thread about PCP and how things were different in our day. There’s more than enough of those in General chat
If he can afford the payments then there’s no reason for us to question his life choices or indeed anyone else who can afford to “lease” a Vantage now that interest rates are so low
^^^^this^^^^If he can afford the payments then there’s no reason for us to question his life choices or indeed anyone else who can afford to “lease” a Vantage now that interest rates are so low
Surely we also need to know the deposit figure??
I would keep the deposit as low as possible as this is just dead money. In any case the combination of deposit and monthlies is only funding the depreciation and you hope/plan for some equity at the end depending on the final payment.
£80K sounds a bit generous to me. If it is a guaranteed that is a good number to have (but as OP says it will leave maybe not much equity to come back). However you juggle it you are invariably robbing Peter to pay Paul. As has been suggested shop around as well.
£80K sounds a bit generous to me. If it is a guaranteed that is a good number to have (but as OP says it will leave maybe not much equity to come back). However you juggle it you are invariably robbing Peter to pay Paul. As has been suggested shop around as well.
It's quite scary playing with the finance calculator sliders.....£10k down, £1k a month.... 
https://www.levencarcompany.co.uk/astonmartin/2014...
https://www.levencarcompany.co.uk/astonmartin/2014...
raceboy said:
It's quite scary playing with the finance calculator sliders.....£10k down, £1k a month....
https://www.levencarcompany.co.uk/astonmartin/2014...
Yes, finance calculators are lethal!https://www.levencarcompany.co.uk/astonmartin/2014...
There’s a very similar example quote in the slideshow for the car to the one i’ve been quoted.
Essentially, £17k deposit, 23 x £600, £80k balloon.
Edited by LiamV12V on Monday 21st January 16:36
LiamV12V said:
Yes, finance calculators are lethal!
There’s a very similar example quote in the slideshow for the car to the one i’ve been quoted.
Essentially, £17k deposit, 23 x £600, £80k balloon.
The dealer reckons this particular Vanquish has bottomed out...
That might be the case , but if it isn’t he’s hardly going to say otherwise is he ?There’s a very similar example quote in the slideshow for the car to the one i’ve been quoted.
Essentially, £17k deposit, 23 x £600, £80k balloon.
The dealer reckons this particular Vanquish has bottomed out...
Buster73 said:
LiamV12V said:
Yes, finance calculators are lethal!
There’s a very similar example quote in the slideshow for the car to the one i’ve been quoted.
Essentially, £17k deposit, 23 x £600, £80k balloon.
The dealer reckons this particular Vanquish has bottomed out...
That might be the case , but if it isn’t he’s hardly going to say otherwise is he ?There’s a very similar example quote in the slideshow for the car to the one i’ve been quoted.
Essentially, £17k deposit, 23 x £600, £80k balloon.
The dealer reckons this particular Vanquish has bottomed out...
I very much doubt it has bottomed out. For starters the previous owner will have got less from the same dealer when it was px’d or sold, and other early vanq2 cars are closer to £90k than this one. A good proposition though to get into a carbon bodied v12 4 seater missile. Get it bought before I get tempted
.I think PCP's can make reasonable sense if you're buying something you plan to keep (reduces the monthly but obviously lengthens any ownership plans), or you're 100% OK with the fact that in 9 our of 10 cases you'll never see a penny of your deposit or monthly payments again, so effectively renting.
£80k does seem like a decent price to be fair. I've no idea what the DB11 is doing to the Vanquish in terms of values though.
@Liam - Is this to replace the V12V or an addition to the stable ?
£80k does seem like a decent price to be fair. I've no idea what the DB11 is doing to the Vanquish in terms of values though.
@Liam - Is this to replace the V12V or an addition to the stable ?
Is there a dealer contribution in there or can you use a broker to finance through a similar PCP?
APR rate looks quite high given rates given they have only just crept over rock bottom rates in place from 2009 (and current consumer confidence and falls in new car sales from 2016 peak etc).
APR rate looks quite high given rates given they have only just crept over rock bottom rates in place from 2009 (and current consumer confidence and falls in new car sales from 2016 peak etc).
having just bought something recently on pcp (first time ever) - it was a bit of a minefield from what I could fathom out.
AM Finance did offer a guaranteed residual - but charged for it and had quite sensible/conservative balloons, whereas 3rd party lenders seemed to not offer guaranteed residuals, but were therefore prepared to accept bigger balloons.
I guess it depends if you are buying to pay off and keep or buying to sell/trade it in within a few years -
I went off and got three different quotes and focused on the total purchase cost over the period - but I did go with a fixed rate deal as who knows what happens in the next couple of years.
Not sure if that helps or not ...
AM Finance did offer a guaranteed residual - but charged for it and had quite sensible/conservative balloons, whereas 3rd party lenders seemed to not offer guaranteed residuals, but were therefore prepared to accept bigger balloons.
I guess it depends if you are buying to pay off and keep or buying to sell/trade it in within a few years -
I went off and got three different quotes and focused on the total purchase cost over the period - but I did go with a fixed rate deal as who knows what happens in the next couple of years.
Not sure if that helps or not ...
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