Buy existing Scirocco currently on PCP or new deal ????
Discussion
HELP and advice gratefully received PLEASE!
Have spent a lot of time searching previous forum posts regarding PCP versus Personal Loan etc but cant seem to find someone in a similar situation to me.
Here's the deal.
1. Currently have an existing VW Scirocco on a PCP. Two year deal runs out in March. Original cost of car = £21,869 and put in £3000 deposit leaving £18869 with a final payment of £12,224.70 due March 2013. Original APR was 7.9%. Currently paying £389 per month for an 18k miles per annum deal (and I do do that mileage)
2. I could purchase at £12,224 with a loan from Tesco finance over 3 years at a cost of approx £370 or somewhere near that. So car would be 5 years old when it was paid off.
3. VW have offered me a new Scirocco (same spec GT but theyve upgraded the spec now to leather and other things as standard). The car now costs more than it did 2 years at £24,152 after 6% discount. The deal that they have offered me is £14500 for my existing car, giving me £2275 equity, plus £1500 additional deposit they will put in, plus they are wanting another £3000 from me - totalling £6775.00 deposit (more than last time but the car of course more expensive in 2013). That leaves £17377 to finance with a lower final payment than the current PCP of either £10,957 after 2 years or £9,180 for 3 years. The monthly cost will be £408 for 2 years or £340 for 3 years on a 7.1% APR.
OR
4. I could borrow £18,877 from Yorkshire Bank at a rate of 7.4% APR (thats me putting in another £3,000 plus the £2,275 equity thats in the car - total deposit £5275). YB personal loan would cost me £375.63 for 5 years for a brand new car
Am completely bamboozled at what to do next for the best - any advice very much welcomed from peeps who have been at this crossroads before with an existing PCP... Im hardly thick but not exactly mathematician of the year and am really struggling to work out which would be in my best interests...
HELP or suggestions of any other different ways to do the deal....
YF Bamboozled Scirocco Driver !
Have spent a lot of time searching previous forum posts regarding PCP versus Personal Loan etc but cant seem to find someone in a similar situation to me.
Here's the deal.
1. Currently have an existing VW Scirocco on a PCP. Two year deal runs out in March. Original cost of car = £21,869 and put in £3000 deposit leaving £18869 with a final payment of £12,224.70 due March 2013. Original APR was 7.9%. Currently paying £389 per month for an 18k miles per annum deal (and I do do that mileage)
2. I could purchase at £12,224 with a loan from Tesco finance over 3 years at a cost of approx £370 or somewhere near that. So car would be 5 years old when it was paid off.
3. VW have offered me a new Scirocco (same spec GT but theyve upgraded the spec now to leather and other things as standard). The car now costs more than it did 2 years at £24,152 after 6% discount. The deal that they have offered me is £14500 for my existing car, giving me £2275 equity, plus £1500 additional deposit they will put in, plus they are wanting another £3000 from me - totalling £6775.00 deposit (more than last time but the car of course more expensive in 2013). That leaves £17377 to finance with a lower final payment than the current PCP of either £10,957 after 2 years or £9,180 for 3 years. The monthly cost will be £408 for 2 years or £340 for 3 years on a 7.1% APR.
OR
4. I could borrow £18,877 from Yorkshire Bank at a rate of 7.4% APR (thats me putting in another £3,000 plus the £2,275 equity thats in the car - total deposit £5275). YB personal loan would cost me £375.63 for 5 years for a brand new car
Am completely bamboozled at what to do next for the best - any advice very much welcomed from peeps who have been at this crossroads before with an existing PCP... Im hardly thick but not exactly mathematician of the year and am really struggling to work out which would be in my best interests...
HELP or suggestions of any other different ways to do the deal....
YF Bamboozled Scirocco Driver !
Deva Link said:
The key work there is "buy" - once he's paid the loan off he'll own the car. If he takes another PCP he's back to zero at the end of it.
Interesting that the price of the new one has gone up but the GFV has come down.
OP: You're bamboozled because there isn't a right or wrong answer. PCPs are designed to get you into a new car every 2 or 3 years, you're not really supposed to keep the car.
But then getting a new car every 2-3 years is never going to make sense from a financial point of view. The thing no-one else can advise on is how much a shiny new car is worth to you.
DEVA - Yes, I was particularly surprised that the cost for the 2012 model has gone up - but does now include satnav as standard, leather, bluetooth which my 2011 GT doesnt have ... The new GFV did puzzle me as they are not bad at holding their value.... in dealer speak (ie Ill tell you what makes me money...) "go for a 3 year dealt because even at 9k GFV youll have a fair bit of equity in it"... I know that theres no right or wrong answer on Personal Loan Vs PCP but always interested in hearing others experiences. Cost probably get about £15.5k for my existing one with 28k miles on in white if I sold it privately ?? Interesting that the price of the new one has gone up but the GFV has come down.
OP: You're bamboozled because there isn't a right or wrong answer. PCPs are designed to get you into a new car every 2 or 3 years, you're not really supposed to keep the car.
But then getting a new car every 2-3 years is never going to make sense from a financial point of view. The thing no-one else can advise on is how much a shiny new car is worth to you.
ALso - I have asked VW about what they are doing about changing the car as its been in general circulation now for all on 5 years... they say not at the moment are there any changes.... any ideas ??
snorkel sucker said:
Does it have to be another Scirocco? You can go elsewhere and see what pix they offer you.
It also sounds like VW aren't giving you much - have you negotiated? Id be looking for at least my £3k deposit back PLUS their contribution, put no more money down AND keep your repayments the same or lower. Interest rates have come down the last 2 years - the rate they are offering you is too high.
Id go back and negotiate with them. Or go elsewhere and see what's on offer.
SNORKEL - thats my thought... I didnt really want to use another 3k out of my money ... of course this is purely their first offer - this bird doesnt accept the first offer lol. I do want another Scirocco - I do quite high miles hence the other reason with my OP - dont really want a 5 year old car with circa 90k on the clock by the time Ive finished with it.... maybe there is my answer PL vs PCP.... ??It also sounds like VW aren't giving you much - have you negotiated? Id be looking for at least my £3k deposit back PLUS their contribution, put no more money down AND keep your repayments the same or lower. Interest rates have come down the last 2 years - the rate they are offering you is too high.
Id go back and negotiate with them. Or go elsewhere and see what's on offer.
BlueMR2 said:
Including your £3k deposit you have paid just over £12k for 2 years hire of a Scirocco.
So an average of £500 per month + insurance and fuel and possibly servicing as well I imagine.
If you are renting then you want the lowest deposit and i imagine the highest gfv so you pay as little as possible per month before you hand it back.
Couldnt agree more BlueMR2 - this is why I am particularly bamboozled. I dont really want to be putting anymore ££ in and I want a high GFV - what they are offering is too low. Its not like the Scirocco is performing poorly in the resale value stakes..So an average of £500 per month + insurance and fuel and possibly servicing as well I imagine.
If you are renting then you want the lowest deposit and i imagine the highest gfv so you pay as little as possible per month before you hand it back.
poing said:
If you buy the car then after 5 years you can take a payment break while you decide what to do. If you then want to get a new car you will have more than enough left in the car you now own to cover the deposit on a new PCP.
I think if I was in your situation I'd go for the purchase option because it gives the greatest flexibility.
Not sure I'll convince the other half to do similar next year when her PCP is up though
Cheers Poing - its a tough one really although I do agree with BlueMR2 if I look that it has cost me £12k over two years - that feels particularly frightening if you look at it that way !!!!I think if I was in your situation I'd go for the purchase option because it gives the greatest flexibility.
Not sure I'll convince the other half to do similar next year when her PCP is up though
poing said:
All you've paid is the deprecation though, that's inevitable on any car bought new regardless of the method used to buy it. The longer you keep it the less it will depreciate each year.
Alternatively look for any online deals for a new PCP from people like Ling Cars (if you can ignore the terrible web site) and maybe even take those figures to your dealer to see if they can improve their offer?
http://www.lingscars.com/Volkswagen/Scirocco-leasi...
Cheers POING - Ill have a look there - tbh can def deal with cheesy websites lolAlternatively look for any online deals for a new PCP from people like Ling Cars (if you can ignore the terrible web site) and maybe even take those figures to your dealer to see if they can improve their offer?
http://www.lingscars.com/Volkswagen/Scirocco-leasi...
Froomee said:
Just a thought.......
Could you not keep your existing car, pay a little more into it say £1500 and loan approximately £10.5k over 2.5 years.
Then extend the warranty which I assume will be relatively cheap.
At the end you will then have a car worth approx £8-10k at a guess as opposed to £0.
Froomee - Good point. That is an option actually... I shall investigate how much a warranty extension is - as I have still got a further year from March 2013 - March 2014 left already ...Could you not keep your existing car, pay a little more into it say £1500 and loan approximately £10.5k over 2.5 years.
Then extend the warranty which I assume will be relatively cheap.
At the end you will then have a car worth approx £8-10k at a guess as opposed to £0.
Emeye said:
OP, are you planning on having kids or moving house any time soon? At least with a personal loan it is easier to sell the car if you want to restructure your finances, rather than trying to get out of a PCP midterm.
Another good point Emeye - no not at present, certainly not in next few years whilst Ive still got commitments like theseEmeye said:
As suggested, I'd go test drive some other new cars locally to get a feel for the offers from other dealers with similar models. You may even find a car you like just as much or more and get an even better deal, especially if they have to hit their figures at the end of he month and have a car you want!
I've not had a newish car for a while, but in the back of mags like autocar, whatcar, top gear, etc they used to have good current special dealer incentives and offers listed. Autocar probably the best if they still do it as it's weekly.
Oh, and I just remembered, I got an email from the AA today offering loans between £7500 and £14999 at 5.5% apr! Might not be the best but better than your bank rate, and you can negotiate finance rates with dealers. Get the best rate online then challenge the dealer to match or better it!
Thats worth looking at then!! Tesco offering 5.2% typical APR at that rate but for some unknown reason (even with an excellent credit rating !!) they quoted me 7.1% so Ill check out the AA... Yorkshire Bank offering 7.4% on £15k to £25k but I have been a customer for donkeys years so they may be able to do something if I go in and see them ...I've not had a newish car for a while, but in the back of mags like autocar, whatcar, top gear, etc they used to have good current special dealer incentives and offers listed. Autocar probably the best if they still do it as it's weekly.
Oh, and I just remembered, I got an email from the AA today offering loans between £7500 and £14999 at 5.5% apr! Might not be the best but better than your bank rate, and you can negotiate finance rates with dealers. Get the best rate online then challenge the dealer to match or better it!
Deva Link said:
Herman Toothrot said:
£12K for 2 years driving a sirocco, that would buy and if you are worried warantee a nice Porsche 996 for 2 years and then at the end of 2 years be able to sell Porsche for about 75% or more of what you paid.
Reading the Porsche forums it wouldn't. How many sets of rear tyres would it need in 30K miles?And you have to park it on the street and someone stamps on it or keys it. Great.
vrsmxtb said:
Not wishing to sound harsh, but shouldn't you have thought about this before signing up?
I've just committed to my first ever PCP finance plan, but made sure I have a plan in place for the final payment if I decide to keep the car, which all depends on my personal/work situation in 3 years and if the notorious VAG 1.4 twincharger proves reliable in that time.
VXB - I have actually considered all of this, I was just wondering about other peoples experiences. The funds are there, the cash is already in the bank out of my own savings which I can also use if I should wish toI've just committed to my first ever PCP finance plan, but made sure I have a plan in place for the final payment if I decide to keep the car, which all depends on my personal/work situation in 3 years and if the notorious VAG 1.4 twincharger proves reliable in that time.
Ari said:
Herman Toothrot said:
I just can't work out how people justify this sort of thing to themselves, maybe I'm just tight Company car where you are forced to buy something boring yes, private .. crazy as a coconut
£12K for 2 years driving a sirocco, that would buy and if you are worried warantee a nice Porsche 996 for 2 years and then at the end of 2 years be able to sell Porsche for about 75% or more of what you paid.
Bonkers as my old man would say.
Bonkers!
UPDATE FROM OP
I have decided to keep my original Scirocco. It stands me at £12k in March left to pay for a car that I know is still worth between 15 and 16K. Although I could use some of my savings outright, I have decided against that and am putting in 2k and financing the other 10K over 2 years with a 5.1% APR loan from YB. That way after 4 years, I will have a car thats four years old and paid for and I can do what I want then .. :-P
I have read with interest all the debate about car allowance being treated as an extension of salaries. I personally think that seeing it as an extension of a salary and spending it on "other things" is a bit dangerous. What if you lose your job and the next job you get doesnt come with a "car allowance" ?? Then youve lost that top up income? Also what if your 15 year old Porsche goes pop and you want to buy a new one and youve used the "car allowance" as part of your income? What do you tell your company then when youve got no car to get to work .... ?
....
I have been in receipt of either car allowance or a company car for the best part of ten years now. The only reason I once opted into the car scheme was because my fuel card was paid for and I could use it for personal use for paying a bit extra in tax. Id rather have a car allowance where I can choose what I have, as to quote another poster, instead of some dull diesel passat or something...
Thanks for all the great debate and for the advice - it was a number of other posters that helped me come to the decision ....
I have decided to keep my original Scirocco. It stands me at £12k in March left to pay for a car that I know is still worth between 15 and 16K. Although I could use some of my savings outright, I have decided against that and am putting in 2k and financing the other 10K over 2 years with a 5.1% APR loan from YB. That way after 4 years, I will have a car thats four years old and paid for and I can do what I want then .. :-P
I have read with interest all the debate about car allowance being treated as an extension of salaries. I personally think that seeing it as an extension of a salary and spending it on "other things" is a bit dangerous. What if you lose your job and the next job you get doesnt come with a "car allowance" ?? Then youve lost that top up income? Also what if your 15 year old Porsche goes pop and you want to buy a new one and youve used the "car allowance" as part of your income? What do you tell your company then when youve got no car to get to work .... ?
....
I have been in receipt of either car allowance or a company car for the best part of ten years now. The only reason I once opted into the car scheme was because my fuel card was paid for and I could use it for personal use for paying a bit extra in tax. Id rather have a car allowance where I can choose what I have, as to quote another poster, instead of some dull diesel passat or something...
Thanks for all the great debate and for the advice - it was a number of other posters that helped me come to the decision ....
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