PCP Part Exchange or Hand Back?
Discussion
I have a 2014 Audi A5 S-Line 2.0 TDI with a few trimmings, bought new from Audi Leeds. Contract ends end of Jan.
Remaining finance balance is £18,871. They say the car is worth £15,000. It has some alloy/front panel damage that they estimate is £1000 to fix. This all means the car is in negative equity.
When I look to part exchange for a new deal, this seems to add about £100 a month to the monthly rental over 48 months. This is consistent across dealers. So I'm thinking that's costing me about £4,800 to part exchange against a new car/PCP contract.
Will it be cheaper to just hand the car back and get a new deal? I'm assuming the GLV means they can't charge me for depreciation of the car?
Cheers!
Remaining finance balance is £18,871. They say the car is worth £15,000. It has some alloy/front panel damage that they estimate is £1000 to fix. This all means the car is in negative equity.
When I look to part exchange for a new deal, this seems to add about £100 a month to the monthly rental over 48 months. This is consistent across dealers. So I'm thinking that's costing me about £4,800 to part exchange against a new car/PCP contract.
Will it be cheaper to just hand the car back and get a new deal? I'm assuming the GLV means they can't charge me for depreciation of the car?
Cheers!
You have 3 options with PCP (which your sales person should really have appraised you of on buying, but that's another issue)
1. Buy the car for the GFV - if you really want to keep it
2. Part ex the car - only if it's worth more than the GFV (be careful of massaged figures to make it appear this way)
3. Hand it back - if it's worth less than the GFV and you've stuck to the mileage limits
Your issue will be the panel damage. On handback, you'll get a bill for rectification so you'll need to stump up something to get out of it. Granted, this won't be as much as the negative equity.
The other option would be to use the VT section of the contract to get out early. Once you've paid half of the total payable (inc GFV) you can legally hand the car back with no further charges (other than necessary repairs and possibly excess mileage). On a 4 year PCP this is usually between months 36-42
1. Buy the car for the GFV - if you really want to keep it
2. Part ex the car - only if it's worth more than the GFV (be careful of massaged figures to make it appear this way)
3. Hand it back - if it's worth less than the GFV and you've stuck to the mileage limits
Your issue will be the panel damage. On handback, you'll get a bill for rectification so you'll need to stump up something to get out of it. Granted, this won't be as much as the negative equity.
The other option would be to use the VT section of the contract to get out early. Once you've paid half of the total payable (inc GFV) you can legally hand the car back with no further charges (other than necessary repairs and possibly excess mileage). On a 4 year PCP this is usually between months 36-42
Thanks @Dimebars / @Nickp82
Ok, think I'll hand it back.
Would you get the work done away from main dealer? I know they charge more. Just don't want them coming back saying "This wasn't fixed to the right standard".
The main issue is a 3mph bump I had which cracked front plate below light. Audi quoted to replace that, and then said a load of interior stuff needs replacing too. They quoted about £1,600.
Ok, think I'll hand it back.
Would you get the work done away from main dealer? I know they charge more. Just don't want them coming back saying "This wasn't fixed to the right standard".
The main issue is a 3mph bump I had which cracked front plate below light. Audi quoted to replace that, and then said a load of interior stuff needs replacing too. They quoted about £1,600.
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