AUC M3, BMW Finance or savings?
Discussion
Hi.
I guess this is not specifically related to just M cars but I'm after some advice on what people would do in my situation.
I've been saving for a newer M3 for years & I'm now in a position when I can think of buying one. I'm after an E90 Coupe (DCT). I was originally thinking of spending around 25K & had started searching but after calling BMW to enquire what AUC they have I now have other thoughts.
Firstly I was told I'd struggle to get an AUC at 25K (with DCT). I was then told it's extremely rare to put a large sum of cash into a car as it's a depreciating asset.
Now I'm not (too) naive & I know BMW will be trying to sell me their Select Finance.
I understand that with Select Finance I could get a better car, i.e. 30k car & also it's a stepping stone to possibly an M4 in 3 years but I want to make sure I'm doing the sensible thing & not being blinded by BMW salesmen as I'm by no means rolling in money unfortunately!
I'd just like other people's opinions or experiences on how they would purchase the kind of car I'm after, i.e. 100% savings & no finance or small deposit & use savings to pay the monthlies etc.
Thanks, Ben.
I guess this is not specifically related to just M cars but I'm after some advice on what people would do in my situation.
I've been saving for a newer M3 for years & I'm now in a position when I can think of buying one. I'm after an E90 Coupe (DCT). I was originally thinking of spending around 25K & had started searching but after calling BMW to enquire what AUC they have I now have other thoughts.
Firstly I was told I'd struggle to get an AUC at 25K (with DCT). I was then told it's extremely rare to put a large sum of cash into a car as it's a depreciating asset.
Now I'm not (too) naive & I know BMW will be trying to sell me their Select Finance.
I understand that with Select Finance I could get a better car, i.e. 30k car & also it's a stepping stone to possibly an M4 in 3 years but I want to make sure I'm doing the sensible thing & not being blinded by BMW salesmen as I'm by no means rolling in money unfortunately!
I'd just like other people's opinions or experiences on how they would purchase the kind of car I'm after, i.e. 100% savings & no finance or small deposit & use savings to pay the monthlies etc.
Thanks, Ben.
It sounds like standard salesman talk on the finance front. It's going to depreciate no matter how you pay.
Congratulations on having the will-power to save such an amount though, I would never be able to do it
.
Personally, I would choose to pay a fairly large deposit, and finance the rest, leaving something in the bank in reserve. I'm not sure if BMW finance has an attractive rate or not these days though.
Congratulations on having the will-power to save such an amount though, I would never be able to do it
.Personally, I would choose to pay a fairly large deposit, and finance the rest, leaving something in the bank in reserve. I'm not sure if BMW finance has an attractive rate or not these days though.
Schermerhorn said:
Finance it.
You dont want to pay outright. If the car is a lemon (like my M6 was/is) and you want to chop it in because you're fed up you MAY take a big hit on it.
Is that so he gets consumer credit protection? If so then can he not get it if he takes out a nominal finance amount on hire purchase? You dont want to pay outright. If the car is a lemon (like my M6 was/is) and you want to chop it in because you're fed up you MAY take a big hit on it.
If you have the cash then pay cash, PCP will give you a guaranteed future value but you pay for BMW taking on that risk.
If there's any chance you will need the cash at some point (house purchase? Business? Wedding?) then finance it.
If you're 65 and have nothing else to spend cash on then pay cash.
Depreciation is Depreciation except with PCP you loose the depreciated cash And get charged interest on the whole borrowed amount.
Council Scum said:
Ben you must be my twin because I too have saved up almost £25k for an AUC M car, I should be ready to buy come summer.
Anyway it's nice to hear of someone in a similar predicament, so I await words of wisdom from clever people.
The next question is, V10 or V8? Hmm.
I guess your username and profile notes are just designed to troll?Anyway it's nice to hear of someone in a similar predicament, so I await words of wisdom from clever people.
The next question is, V10 or V8? Hmm.
O Dear a dreamer.Thanks for the replies, my main reason for asking is I'm sure they are far wiser people on here than me so all points made have been taken on board.
A bit more background info...I'm 32, single, no kids & have a mortgage (50% shared ownership). As my mind is very PH orientated, my single plan for the last 8 years has been to save for & buy a new(er) M3 & I've got no plans for any other big expenditures (except fuel!)
I did go through the dilemma of V10 or V8 but decided to go V8 as this car will be a weekend 'fun' car so thought the M3 more applicable.
Once again, thanks for the replies!
Cheers, Ben
A bit more background info...I'm 32, single, no kids & have a mortgage (50% shared ownership). As my mind is very PH orientated, my single plan for the last 8 years has been to save for & buy a new(er) M3 & I've got no plans for any other big expenditures (except fuel!)
I did go through the dilemma of V10 or V8 but decided to go V8 as this car will be a weekend 'fun' car so thought the M3 more applicable.
Once again, thanks for the replies!
Cheers, Ben
the other option is to get finance not from BMW.
depending on the deals being offered, you may end up with a better deal getting finance independently rather than through BMW directly.
e.g. Gareth @ bespoke auto sorted out finance with an interest rate of 5.5% for me on a previous car, through santander, vs 7.5% through BMW Select.
depending on the deals being offered, you may end up with a better deal getting finance independently rather than through BMW directly.
e.g. Gareth @ bespoke auto sorted out finance with an interest rate of 5.5% for me on a previous car, through santander, vs 7.5% through BMW Select.
M5/M6's are cheaper and probably won't depreciate as much, plus you'll have almost 100 more bhp and 2 more cylinders to play with. Test drive both a V8 and V10 before you decide.
If you have the money saved up then I'd say pay cash, no reason to pay loan interest that's higher than your mortgage rate. A £20k loan at 7.5% over 3 years works out at £2400 interest.
It will also be worth your while checking out private ads from enthusiast owners. Get a Mondial warranty and it will work out quite a bit cheaper overall than an AUC car, and you'd also get to know the previous owner and history of the car a bit better.
If you have the money saved up then I'd say pay cash, no reason to pay loan interest that's higher than your mortgage rate. A £20k loan at 7.5% over 3 years works out at £2400 interest.
It will also be worth your while checking out private ads from enthusiast owners. Get a Mondial warranty and it will work out quite a bit cheaper overall than an AUC car, and you'd also get to know the previous owner and history of the car a bit better.
The car will depreciate at the same rate if you finance it or not. If you finance a more expensive car then you may lose more cash in depreciation than the cheaper car. Bottom line is, can you earn more after tax on your capital than you are going to pay in interest? Also you run the risk of actually losing money on your investment as you try to make more than the APR you are paying. The only other issue is keeping some cash for emergencies, car or house related. Don't put every spare penny you have into the car. You also need to budget for the running costs, insurance, tyres, tax and service etc!
Both - put a decent deposit down to get low monthly payments.
Save some cash, as others have said, in case something goes wrong. Plus servicing is. It money on M cars, so you have to factor that in.
And you can get an AUC with DCT for under £25k if you are patient and keep checking. But why skimp?
With that deposit, you may find a new Or nearly new M5 with it's warranty and a servicing pack is affordable.
Save some cash, as others have said, in case something goes wrong. Plus servicing is. It money on M cars, so you have to factor that in.
And you can get an AUC with DCT for under £25k if you are patient and keep checking. But why skimp?
With that deposit, you may find a new Or nearly new M5 with it's warranty and a servicing pack is affordable.
As much as I love M cars and I've had a few, just to muddy the waters as you are single 
http://www.pistonheads.com/classifieds/used-cars/a...
http://www.pistonheads.com/classifieds/used-cars/l...
http://www.pistonheads.com/classifieds/used-cars/a...
http://www.pistonheads.com/classifieds/used-cars/l...
benm3evo said:
I did go through the dilemma of V10 or V8 but decided to go V8 as this car will be a weekend 'fun' car so thought the M3 more applicable.
Horses for courses and all, but I think the V10 would probably be more suited to the weekend than the V8. Not only that but you will have some change if you buy an M5, that buys a lot of petrol.As for finance, if you're after a keeper then perhaps its worth stretching yourself / taking out a small loan to get the model and specification you really want.
Nooooo! Not more car suggestions! I saw a mate last night who mentioned a V8 Vantage, an RS6 (he has a 2003 V8 one) & also presented another good case for a V10. That's week of sleepless nights for me!
At the moment the plan is to go to the local dealer on Saturday & get some figures on paper (based on a large deposit) for an M3 so I have a better idea if I choose to go the finance route. I'm really hoping they haven't got an M5 or M6 there as I'll be sorely tempted to ask for a test drive in it!
Thanks for the continued food for thought!
Cheers, Ben
At the moment the plan is to go to the local dealer on Saturday & get some figures on paper (based on a large deposit) for an M3 so I have a better idea if I choose to go the finance route. I'm really hoping they haven't got an M5 or M6 there as I'll be sorely tempted to ask for a test drive in it!
Thanks for the continued food for thought!
Cheers, Ben
MerseaBoy said:
The car will depreciate at the same rate if you finance it or not. If you finance a more expensive car then you may lose more cash in depreciation than the cheaper car. Bottom line is, can you earn more after tax on your capital than you are going to pay in interest? Also you run the risk of actually losing money on your investment as you try to make more than the APR you are paying. The only other issue is keeping some cash for emergencies, car or house related. Don't put every spare penny you have into the car. You also need to budget for the running costs, insurance, tyres, tax and service etc!
That's brilliant advice as opposed to the usual "rent it if it depreciates, buy it cash if it depreciates" sweeping statement.Yes it is good advice.
As hard has it has been to save the money in the first place, it will be equally as hard to part with it so I know I would be sensible to keep a decent amount for emergencies...plus fuel, servicing etc.
I always thought saving to buy the car I want was the way to go, & deep down I know it is, but it almost seems like it raises more questions! I'm hoping when I have some figures written down it will become easier to make a decision when I can see what interest I'll be paying & what (little) interest I can earn on the savings I hold on to.
Cheers, Ben.
As hard has it has been to save the money in the first place, it will be equally as hard to part with it so I know I would be sensible to keep a decent amount for emergencies...plus fuel, servicing etc.
I always thought saving to buy the car I want was the way to go, & deep down I know it is, but it almost seems like it raises more questions! I'm hoping when I have some figures written down it will become easier to make a decision when I can see what interest I'll be paying & what (little) interest I can earn on the savings I hold on to.
Cheers, Ben.
Definitely good advice so far.
One of single biggest factors to take into account is depreciation which is likely to be quite high on this price range of cars. The reason I mentioned the v8V and Evora is that they are holding their prices exceptionally well over the last 2 years so if you buy smart then you could realistically run one for 18 months or so and lose very little in depreciation so well worth taking that into account in your decision making.
Good luck and enjoy the process - it's meant to be exciting and fun, not stressful!
One of single biggest factors to take into account is depreciation which is likely to be quite high on this price range of cars. The reason I mentioned the v8V and Evora is that they are holding their prices exceptionally well over the last 2 years so if you buy smart then you could realistically run one for 18 months or so and lose very little in depreciation so well worth taking that into account in your decision making.
Good luck and enjoy the process - it's meant to be exciting and fun, not stressful!
Edited by Herbs on Thursday 13th February 12:33
Some good advice on the financials.
If you're looking for a nice example to buy, I can wholeheartedly (although very sadly) recommend this one:
http://www.approved.bmw.co.uk/bmwuk/bmwauc/details...
If you're looking for a nice example to buy, I can wholeheartedly (although very sadly) recommend this one:
http://www.approved.bmw.co.uk/bmwuk/bmwauc/details...
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