Discussion
Hi all
I am looking at opting out of my company car scheme and getting a 1 year old 5 series touring.
Contrary to common PH-wisdom, I will be buying the car on a PCP finance deal.
When one looks at the BMW website, the finance calculator shows a frankly ridiculous APR of some 12%. Surely this is negotiable in this current market.
They do low APR rates on new cars - some 3%, which I don't expect to be matched but what is a realistic expectation to go for here?
TIA
I am looking at opting out of my company car scheme and getting a 1 year old 5 series touring.
Contrary to common PH-wisdom, I will be buying the car on a PCP finance deal.
When one looks at the BMW website, the finance calculator shows a frankly ridiculous APR of some 12%. Surely this is negotiable in this current market.
They do low APR rates on new cars - some 3%, which I don't expect to be matched but what is a realistic expectation to go for here?
TIA
Yeah do the maths very carefully, I got 2.8% from Hitachi recently.
The amount saved in interest meant that doing it over 60 months instead of 48 the car was owned outright rather than having a £12000 balloon.
If looking at a year old look at new from a broker, you mind find it works out a fair bit less than buying a used one if using finance.
My old man was looking at an X5, on a £35000 car with £8000 down it was coming in at £515 a month.
He then looked at a Cayenne, same price, with £8000 down it came in at £294 a month because of Porsches much better residuals and better APR.
The amount saved in interest meant that doing it over 60 months instead of 48 the car was owned outright rather than having a £12000 balloon.
If looking at a year old look at new from a broker, you mind find it works out a fair bit less than buying a used one if using finance.
My old man was looking at an X5, on a £35000 car with £8000 down it was coming in at £515 a month.
He then looked at a Cayenne, same price, with £8000 down it came in at £294 a month because of Porsches much better residuals and better APR.
I'd always work out a bank loan, mortgage extension, parental loan etc. cash buy as a baseline for comparison before committing. I got my previous 3 Series using BMW financing but they were offering 3.9% for the loan, and an option to buy for £18K or return the car after 36m. For my current M235i Convertible, I used my offset mortgage and it worked out £4,100 cheaper over 36m compared to the BMW financing. I 'paid off' the money I'd 'borrowed' from myself, so to speak, over about 20 months, but with a lot of variation in what I put aside each month. Even given the interest payments at 2.9% it still worked out the cheapest option.
I'd just make the obvious point about locking yourself into a car financing scheme: in my case, with the previous car I changed jobs after about 18 months and wasn't doing the high motorway mileage any more, but I had to persevere with a car that wasn't really right for my circumstances for another 18 months because of the terms of what I'd signed-up to. I know some schemes allow for early cancellation of the contract, so make sure you can do this if you go for a longer term.
Also most financing is based on residuals and residuals are based on mileage. I know a number of people who've greatly exceeded their expected mileage thanks to changes to their job (or simply been too optimistic about low mileage) and got hit by a big charge at the end.
I'd just make the obvious point about locking yourself into a car financing scheme: in my case, with the previous car I changed jobs after about 18 months and wasn't doing the high motorway mileage any more, but I had to persevere with a car that wasn't really right for my circumstances for another 18 months because of the terms of what I'd signed-up to. I know some schemes allow for early cancellation of the contract, so make sure you can do this if you go for a longer term.
Also most financing is based on residuals and residuals are based on mileage. I know a number of people who've greatly exceeded their expected mileage thanks to changes to their job (or simply been too optimistic about low mileage) and got hit by a big charge at the end.
Edited by msej449 on Saturday 21st July 23:53
Thanks for the replies all.
I'm fairly open to any kind of financial deal but I've always taken the view that my car allowance pays for the car (and interest on payments) as a direct offset of each other.
I'm not one of these types who sees it as extra salary and, besides, I have restrictions as to what I can drive (must be less than 3 years old, etc)
A few years back I had a Golf brand new on a PCP, which worked well, but looking for something more upmarket now.
I'm fairly open to any kind of financial deal but I've always taken the view that my car allowance pays for the car (and interest on payments) as a direct offset of each other.
I'm not one of these types who sees it as extra salary and, besides, I have restrictions as to what I can drive (must be less than 3 years old, etc)
A few years back I had a Golf brand new on a PCP, which worked well, but looking for something more upmarket now.
Wills2 said:
Peter Vardy are offering a 520d M sport touring for £408 in and £408 per month 0% APR over 48 months
Do you have a link for this please?Used car finance rate with BMW is negotiable, expect to get to around 7% or 8% depending on how much you are borrowing.
As other people have said, if you are looking at a year old 5 Series a strong deal on a new one with the much lower APR would be very similar I would think. From experience this has always been the case.
Based on how I know the new car market for BMW is at the moment, I would think a competitive deal would be easy to get no matter which dealer you go to.
That said there will be some dealers (probably most) with Pre-Registered cars at reduced prices that can be done on the "new car rate", I work for MINI and I know our BMW site have lots!
Hope that helps
CCC
As other people have said, if you are looking at a year old 5 Series a strong deal on a new one with the much lower APR would be very similar I would think. From experience this has always been the case.
Based on how I know the new car market for BMW is at the moment, I would think a competitive deal would be easy to get no matter which dealer you go to.
That said there will be some dealers (probably most) with Pre-Registered cars at reduced prices that can be done on the "new car rate", I work for MINI and I know our BMW site have lots!
Hope that helps
CCC
Muzzer79 said:
Ziplobb said:
why dont you get a bank loan - 3.9%APR is what i apid on the last one I had and you own it .
Up to £25k and a bank loan can be had for a low rate.Over £25k then it's more like 6.5-7% from a bank
Be aware also that in many cases, if you apply for a bank loan, lured in by a 3~3.9% APR, and then decide not to proceed with the loan because the actual rate you've been offered is a lot higher (@ 6.9% APR seems to be quite common), it can have a negative effect on your personal credit score!
Thanks for the info all
The 0% finance deal has now ended and they had limited stock, so I’ve not pursued
However, a 1 year old touring with all the toys can be had for under £30k so this takes me into personal loan at low APR rates territory. I’ll also own the car at the end, rather than paying a balloon
A £50k car with someone else taking a 40% hit in depreciation over the first year appeals quite highly and I intend to keep it for a good few years. 🙂
The 0% finance deal has now ended and they had limited stock, so I’ve not pursued
However, a 1 year old touring with all the toys can be had for under £30k so this takes me into personal loan at low APR rates territory. I’ll also own the car at the end, rather than paying a balloon
A £50k car with someone else taking a 40% hit in depreciation over the first year appeals quite highly and I intend to keep it for a good few years. 🙂
Gassing Station | BMW General | Top of Page | What's New | My Stuff