VT - at what point exactly in the following scenario????

[numtumfutunch]

BMW 340i Touring

List price 45,830

Dealer contribution £6630
BMW contribution £3500

Customer balance £35,700

Customer deposit is £4200 then 47 x £399 (plus optional final payment (GFV) £14,435)

APR is 1.9%

So at what point exactly can I VT this deal?
Person offering it is a bit woolly

My main concern is that the dealer and BMW contributions are a bit vague when entered into the mix
Is it 50% of the official list price plus interest or else 50% of the price after dealer and BMW contributions plus interest?

Cheers

[northwest monkey]

It's 50% of the amount you're borrowing isn't it? It was when I've done it in the past anyway.

[pd2]

northwest monkey said:

It's 50% of the amount you're borrowing isn't it? It was when I've done it in the past anyway.

You repay 50% of the Total Amount Payable, not the total amount borrowed, as you need to include interest and fees, so it’s not just half of your scheduled monthly payments. It also includes you GFV.

From memory, I don’t think you need to worry about the contributions as you are no longer dealing with BMW or the dealer, this is between you and the finance company.

So my guess work starts here....

6630+3500+4200+18753(399x47)+14435= 47518 (total payable)

47518 / 2 = 23759 (50%)

23759-6630-3500-4200= 9429 (amount needed to pay via monthly payments)

9429 / 399= 23.63

So VT ‘should’ be possible after 24 months.

Or until someone says I’m totally wrong and does it right.... lol

Paul

Edited by pd2 on Monday 11th June 00:21

[numtumfutunch]

^^^^^ thanks

So I'm right in thinking that the VT point is effectively calculated with the discounted price, plus the other variables?

Edited by numtumfutunch on Tuesday 12th June 19:00

[Camelot1971]

Those calculations don't seem right.

You need to take the total amount borrowed (after taking into account the deposit, contributions and the interest) and then halve that.

So it's roughly £31,500 + interest divided by 2.

Most PCP deals reach VT point around 6 months before the end of the contract, which looks about right for your deal too.

If you post up the total amount borrowed we can work it out.

[SmoothCriminal]

I thought it would be the total monthlies plus the optional final payment divided by 2?

As it's not the total cost of the car just what you are borrowing.

You have effectively paid for a % of the car with a deposit so that can't be taken into account when calculating the total likewise the dealer contribution either.

[milu]

As I remember it it's 'half the total amount payable under this agreement'. So deposit etc is included but of course you paid that so it goes toward the half payable.

[JB8]

It's half of the total amount payable under the agreement, EXCLUDING any deposit or dealer/manufacturer contributions.

So for this agreement, once £16,594 has been paid, or around the 42nd instalment.

[Butter Face]

Deposit contributions count towards your ‘total amount oayable’

So your total payable is:

£6630 + £3500 + £4200 + £18753 + £14435 = £47518 total.

Half is £23759 and you’d paid £14330 upfront (including DC) so after 24 payments you’ll be at VT point.

HTH

[Butter Face]

JB8 said:

It's half of the total amount payable under the agreement, EXCLUDING any deposit or dealer/manufacturer contributions.

So for this agreement, once £16,594 has been paid, or around the 42nd instalment.

Total payable includes all deposits and deposit contributions.

[JB8]

Butter Face said:

JB8 said:

It's half of the total amount payable under the agreement, EXCLUDING any deposit or dealer/manufacturer contributions.

So for this agreement, once £16,594 has been paid, or around the 42nd instalment.

Total payable includes all deposits and deposit contributions.

No it doesn't. The 'total payable' is different from the 'total amount payable under the credit agreement'.

The VT point is based on the latter.

Edited by JB8 on Tuesday 12th June 22:09

[Butter Face]

JB8 said:

Butter Face said:

JB8 said:

It's half of the total amount payable under the agreement, EXCLUDING any deposit or dealer/manufacturer contributions.

So for this agreement, once £16,594 has been paid, or around the 42nd instalment.

Total payable includes all deposits and deposit contributions.

No it doesn't. The 'total payable' is different from the 'total amount payable under the credit agreement'.

The VT point is based on the later.

What?

There is no difference.

Any deposits are counted towards a ‘total amount payable’

[Butter Face]

Here’s some actual screenshots from an actual finance agreement in case you don’t quite understand



A + B + C



Half of the above.

The deposit was £2750 cash + £500 DC.

[rsbmw]

Dealer/manufacturer contributions are normally not included (specific contract should be referred to), but your deposit will be.

In your example, (4200+(47*399)+14435)/2 = £18694 would be payable in order to VT. This would fall naturally around 3 years into a 4 year contract, which is pretty typical. You could terminate at any point though as long as you pay the difference between what you have currently paid and this number.

[TooMany2cvs]

numtumfutunch said:

Customer balance £35,700
Customer deposit is £4,200

So the amount borrowed is £35,700-£4,200 = £31,500 - you're not borrowing the deposit.

numtumfutunch said:

then 47 x £399 (plus optional final payment (GFV) £14,435)

So the total repayable is (£399 x 47) + £14,435 = £33,188
50% of that is £16,594

So you'll reach that point (£16,594 - £14,435)/£399 = £2,159/£399 = 5.4 months before the end of the contract. So can't hand it back 6 months before the end (less than 50% paid), but can 5 months before the end.

Edited by TooMany2cvs on Tuesday 12th June 22:46

[pd2]

lol...

Numtum! Check you finance agreement or phone the finance company!

Then come back and clarify it for us all! 😂

[Butter Face]

pd2 said:

lol...

Numtum! Check you finance agreement or phone the finance company!

Then come back and clarify it for us all! ??

Yes please do.

Sorry that I nissed your explanation before I posted mine too! You are of course bang on correct.

[numtumfutunch]

Butter Face said:

pd2 said:

lol...

Numtum! Check you finance agreement or phone the finance company!

Then come back and clarify it for us all! ??

Yes please do.

Sorry that I nissed your explanation before I posted mine too! You are of course bang on correct.

I dont have a finance agreement Im afraid

the above deal caught my eye and I was wondering about how flexible it might be in terms of VT
As Im not about to commit to it, although am vaguely interested at the moment, I dont want to either waste the dealers time or go through whatever credit checks would be necessary to proceed unless Im going to buy/PCP it

The thread does demonstrate that its a bit murky to say the least without actually printing out the final documents

Thanks all

If I go ahead I will report back, Im hoping for a run out 0% APR 340i to be honest next quarter.......

Cheers

[nmd87]

In my experience the dealer deposit contribution is included but the manufacturer deposit contribution isn't.

I bought a car on PCP a couple of years ago. The list price of the car was £25k but I negotiated this to £19k. This discount was achieved through a £3k manufacturer contribution (i.e. conditional on taking a PCP) and £3k from the dealer which would be put down as a deposit on the PCP (dealer deposit contribution).

The finance agreement was therefore for £22k; with a £3k dealer deposit and £500 deposit from me, this left me £19.5k to pay including interest (interest was only 0.3% APR over 4 years).

I was able to VT the agreement with a remaining balance of £11k left payable, having myself paid £8,250 in 30 monthly payments of £275, £500 initial deposit and the dealer £3k deposit contribution.

So you could argue that I effectively did VT the agreement having paid significantly under 50% of it myself (£8,750 of £22k).

Numbers may be slightly out due to rounding!

[xjay1337]

When we VT'D my Mrs' car her credit rating took a big hit. Something to note perhaps.