Jump to content

How do most owners buy their cars - Outright or PCP


trooperj3

Recommended Posts

At the end if the day I pay 120quid a month for my car, I can easily afford this

So its no worries for me. I could go out and pay 2k for a banger but I'd probably spend the same again over a few years on repairs. As it is I've bought a citigo using cash I don't miss, whilst still having ny savings that are at least staying the same in value whilst the car you have bought using savings has lost 60 - 70% of its value.

 

Something I've been changing my mine over and over again about. I currently use an "old banger" for my commute and keep wondering if I'd be better off with a new car on PCP, however as it stands all I'd gain is the pleasure of a new car as over the past year my 2004 Yaris has cost me £122 per month all in (including purchase, repairs, fuel, tax, insurance) I'd be hard pushed to find a PCP deal that works out as good overall - which is a shame as I don't particularly like driving the Yaris but it's just too cheap to run to justify getting rid of!

Link to comment
Share on other sites

So you save up hard and have £15k to buy a new Fabia, well done. The Fabia you want is RRP £17k, you haggle £15k 'for cash' and think you've got a great deal. The dealer has probably made nothing, and this may well reflect in the aftersales you receive, and possibly also any 'goodwill' discounts for out of warranty repairs.

With most of the finance options, the manufacturer will be offering the dealer some support, e.g. For quarter 3 2015 we will offer your customers 0% APR and give the customer £500 deposit contribution AND the dealer is offered an extra 1% margin on the car. These discounts wouldn't be available if you were paying cash, its money coming from the manufacturer in addition to the dealers normal margins. So you may well be able to get the car for under £15k 'for cash' price, the dealer makes more money and as such is more inclined to look after you. You can keep your £15k in the bank and use it for other things, and should you have problems with the car the dealer can't resolve then you also have the finance company to fall back onto.

Cash isn't king anymore.

A lot of people paying 'cash' are really borrowing money from the bank anyway (even if its just £15k they could have paid off the mortgage at 2.9%), and giving it large in the dealers 'but I'm paying cash'.

Just to add, I paid 'cash' for mine too, but I was under no illusion that it must be the financially best way to buy the car.

They are legally abiliged to provide after sales care and resolve any problems you may have yanno.. The cars still got 3 years warranty.

Ive never heard anything like that before... Nor have i ever been successfully fobbed off by a dealer for any problem ive had.

Link to comment
Share on other sites

Save up.

Its how it always used to be done, and i prefer the idea now too.

I dont get why everybody is obsessed with monthly payments tbh. It just seems impatient and it would never feel as though its 'mine'.

 

 

My old car in three years time would be worth zero, the same as my Citigo will be as well to me, the reality is my last banger would quite possibly have needed replacing within 3 years so that's another £500 gone, and the monthly cost including fuel is about the same, so why wouldn't I swap? Obviously the dealers are happy with this as they've sold a car they wouldn't have, i'm happy as i'm paying the same monthly (also the same over the 3 year period if not less). 

 

The smart money for me would have been to buy a more economical Auto for a couple of k, but A. they're not that easy to find, and B. a lot of older cars tend to have some things not working that takes time/money to put right (maybe ocd but I cant abide things that should work not working, so I have to fix them.)

Link to comment
Share on other sites

My old car in three years time would be worth zero, the same as my Citigo will be as well to me, the reality is my last banger would quite possibly have needed replacing within 3 years so that's another £500 gone, and the monthly cost including fuel is about the same, so why wouldn't I swap? Obviously the dealers are happy with this as they've sold a car they wouldn't have, i'm happy as i'm paying the same monthly (also the same over the 3 year period if not less). 

 

The smart money for me would have been to buy a more economical Auto for a couple of k, but A. they're not that easy to find, and B. a lot of older cars tend to have some things not working that takes time/money to put right (maybe ocd but I cant abide things that should work not working, so I have to fix them.)

 

you might be missing the point. 

 

look at it methodically. buy a 6 month old (okay i cant talk, the Fab was new, but that was my choice) buy some miles on it, sell it in a few years time. As long as you dont keep em too long, buy at the right price and look after it, you dont have to lose too much. 

 

infact, it could even profitable. I know people who have bought very nice cars cash and sold them shortly after and made a few K. Youve just gotta know what youre doing with it and be clever. 

 

For me, im not arsed. Ill be keeping the 2013 Fab until it starts costing me too much to keep it. its a no thrills thing for me.. i enjoy driving it, but i swap and choose motorbikes and get my fun there. So i dont mind have a trusty reliable motor for hopefully ten years or so. but im not arsed about the money side of the Fabia. it just is what it is. 

Link to comment
Share on other sites

As I said the smart money would have been to look for a £2k  economical auto, but the reality of that can be a PITA, so far as buying right I bought a £300 banger back in 2007 and before the Citigo didn't add any more to that 'pot' in 4 bangers, the last going as the Citigo deposit. However the reality is a lot of auto's being bigger cars and liking a drink, add to that the tax, mot, repairs, and servicing (which in the main are parts only as I tend to DIY), did mean the Citigo became cost neutral to where I was, without even having any catastrophic failures. Add to that if you buy 6 months old you tend to pay more apr than 0%, in the end the figures tend to be the same, not forgetting of course with the MGFV I don't have to worry. If i'd bought and seeing the lower prices of second hand cars i'd maybe be worried now. also (in 2.5years time my circumstances change a lot, I have no idea if I need a m'way car, an van, or even no car)

 

I also swap my bikes, and have found that's where you can easily make a k or two, even after having a year of fun out of them.

Link to comment
Share on other sites

My big worry is lots of people walk into a car showroom and get the headline figures chucked at them of £99 deposit and ONLY £99 a month at the end hand it back and use as a deposit but that is where a majority get duped.

They do not see that GFV as a final payment to own the car, a lot think incorrectly that the GFV is their deposit for their next depreciating asset and ever growing debt.

Then they forget to factor in the dealer service regime if not included and then looking after it within the strict terms and being charged for all the scratches and dents they inevitably get.

I also do not see why so many today feel they need brand new cars.

I was in and out of cars within months sometimes weeks, committing to a 3 year PCP is a long time when your young and most do not see the hidden costs to get out if they get bored.

What's wrong with a few old bangers and learning how to do basic maintenance?

Hey ho each to their own but think too many dive into debt without seeing the full cost.

Edited by Defenderben
  • Like 1
Link to comment
Share on other sites

I know what you are saying, I was fed up of constantly having to sink money into my old Audi to keep it tip top, the Citigo works out about £10 a month more than my old Audi, and that's if nothing went wrong with my old car. I wanted a few years of hassle free cheap motoring.

Link to comment
Share on other sites

Hyphons....see you have leather seats? Is that an option on a Citigo or have you had it done as a special (sorry to go off thread) :(

Had it done by seat Surgeons, cheap if you ask me, think the optional leather on the up is something like £1,200?! Mine cost £1,020 and the bonus is its a mix of faux/real leather unlike the Up!'s faux leather

Sent from my SM-G920F using Tapatalk

  • Like 1
Link to comment
Share on other sites

Bought mine through PCP. Worked nicely; 0% APR, PCP payments run up until I graduate at which point I could walk away, or buy outright. Most likely, buy outright, or swap for something else (non-skoda, sorry...).

Link to comment
Share on other sites

I do 30,000 private miles a year so a PCP or lease just doesn't work.

 

Instead I bought an 18 month old diesel Superb with 14,000 miles on it for £12,500.

 

Just over 2 years later and on close to 90,000 miles it is still going strong and looks as good as the day I bought it.

 

I'll be running it until it dies which hopefully will be close to 300,000 miles or another 6 or 7 years.

 

That'll work out at £1,400 per year.

 

I also put a chunk of cash aside each month to put towards the next car, money in the bank to pay for repairs on this car if required as it reaches the end of its viable life.

  • Like 2
Link to comment
Share on other sites

By the way, I need you guys to keep chucking cash at brand new PCP's.

 

When you've got bored with it and chopped it in for another brand new car I get to buy it and run it for the rest of it's days.

 

All these people running newer cars more frequently means more used choice for me, happy days  :sun:

  • Like 2
Link to comment
Share on other sites

By the way, I need you guys to keep chucking cash at brand new PCP's.

 

When you've got bored with it and chopped it in for another brand new car I get to buy it and run it for the rest of it's days.

 

All these people running newer cars more frequently means more used choice for me, happy days  :sun:

you're spot on there mate. 

 

Only thing that puts me off is how people  treat (okay, not all.. calm down people :D) their financed cars. I've got a few mates that finance. They're usually thrashed from cold... washed with brick acid once every few months and just generally abused.. i ask why.. they say 'well, ill give it back in 3 months.. why not?'. 

 

makes me sick tbh. 

  • Like 2
Link to comment
Share on other sites

As I said the smart money would have been to look for a £2k  economical auto, but the reality of that can be a PITA, so far as buying right I bought a £300 banger back in 2007 and before the Citigo didn't add any more to that 'pot' in 4 bangers, the last going as the Citigo deposit. However the reality is a lot of auto's being bigger cars and liking a drink, add to that the tax, mot, repairs, and servicing (which in the main are parts only as I tend to DIY), did mean the Citigo became cost neutral to where I was, without even having any catastrophic failures. Add to that if you buy 6 months old you tend to pay more apr than 0%, in the end the figures tend to be the same, not forgetting of course with the MGFV I don't have to worry. If i'd bought and seeing the lower prices of second hand cars i'd maybe be worried now. also (in 2.5years time my circumstances change a lot, I have no idea if I need a m'way car, an van, or even no car)

 

I also swap my bikes, and have found that's where you can easily make a k or two, even after having a year of fun out of them.

looking at a PCP deal on the Skoda page atm. 

 

41 monthly payments of £115

Deposit: £1250

Optional final payment: £3,669.25

 

So you've then paid £5,965 and 3 and a half years later youve got nothing to show for it. 

 

Or, you could then pay the optional final payment making it £9,634 and actually have something at the end of the day. 

 

So if you want the car to keep, youve then paid £9.5k for a Citigo SE 3door. 

 

But if you get fed up after 42 months and want something new (many do) you've paid nearly £6k and theres bugger all left to show for it. Time to start again. 

 

You could pay £6k and get this: 

 

http://www.ebay.co.uk/itm/2014-Skoda-Citigo-1-0-MPI-60PS-SE-Petrol-white-Manual-/181931371174?hash=item2a5bf46aa6:g:GNQAAOSweuxWRedC 

 

With 6k on the clock.. 2 years warranty left, run it as much as you like and sell it when you want. its yours. That was just the first example i saw on ebay. 

 

I am aware that those prices are list prices and some discounts may be available via Orange Wheels, Drive The Deal etc etc but i cant see it closing that gap tbh. 

 

But thats just my outlook.. and i may well be missing something, as i dont know too much about finance, as it just doesn't generally interest me tbh. 

Edited by fabiamk2SE
  • Like 1
Link to comment
Share on other sites

It depends how you look at the numbers. The rest of he world has no obsession with owning things but for some reason the uk does?.

But you could buy a new citigo cash for 10k, after 3 years it's worth 3.25k so for 3 years you've spent 6750

On a pcp with 1 months deposit you could get them over 42 months with no deposit (the only way to make a pcp work in your favour) with a Gfv of 4000 total cost over 3 1/2 years 6000. And you got 3 years servicing.

I've been down the whole buy cheap second hand and to be honest I can't be arsed. There's too many potential big bills - I've seen too many people buy an Audi with low mileage and have to pay the best part of a grand one year for a clutch and dmf and a grand next year for a turbo, modern cars aren't reliable or cheap to repair- and I don't have the time to faf on any more, I have a life which gets in the way!

Link to comment
Share on other sites

They are legally abiliged to provide after sales care and resolve any problems you may have yanno.. The cars still got 3 years warranty.

Ive never heard anything like that before... Nor have i ever been successfully fobbed off by a dealer for any problem ive had.

There are obligations and then there is goodwill.

Link to comment
Share on other sites

looking at a PCP deal on the Skoda page atm. 

 

41 monthly payments of £115

Deposit: £1250

Optional final payment: £3,669.25

 

So you've then paid £5,965 and 3 and a half years later youve got nothing to show for it. 

 

Or, you could then pay the optional final payment making it £9,634 and actually have something at the end of the day. 

 

So if you want the car to keep, youve then paid £9.5k for a Citigo SE 3door. 

 

But if you get fed up after 42 months and want something new (many do) you've paid nearly £6k and theres bugger all left to show for it. Time to start again. 

 

You could pay £6k and get this: 

 

http://www.ebay.co.uk/itm/2014-Skoda-Citigo-1-0-MPI-60PS-SE-Petrol-white-Manual-/181931371174?hash=item2a5bf46aa6:g:GNQAAOSweuxWRedC 

 

With 6k on the clock.. 2 years warranty left, run it as much as you like and sell it when you want. its yours. That was just the first example i saw on ebay. 

 

I am aware that those prices are list prices and some discounts may be available via Orange Wheels, Drive The Deal etc etc but i cant see it closing that gap tbh. 

 

But thats just my outlook.. and i may well be missing something, as i dont know too much about finance, as it just doesn't generally interest me tbh. 

 

The trouble is that's a manual, and only 3 doors.  I haven't got 6k in the bank so it'd be a loan, with apr, so doing a quick web calculation it'd be £150/month, so more than the pcp, and then 3 years later I've got a car I don't want (potentially) that I need to sell, paying advertisement and the hassle of selling it.  Don't forget servicing at what £150+ a go?, mot etc.

Link to comment
Share on other sites

The trouble is that's a manual, and only 3 doors. I haven't got 6k in the bank so it'd be a loan, with apr, so doing a quick web calculation it'd be £150/month, so more than the pcp, and then 3 years later I've got a car I don't want (potentially) that I need to sell, paying advertisement and the hassle of selling it. Don't forget servicing at what £150+ a go?, mot etc.

Obviously other models are available. That was just the first one on ebay i saw.

What works for one doesnt work for another n all that. Personally, i couldnt do it. But if it works for you, its all good (:

Edit: just to clarify, i do save for stuff, i dont have thousands sat about, unfortunately. :D

Edited by fabiamk2SE
  • Like 1
Link to comment
Share on other sites

  • 1 year later...

You insure it as if you own it :)

My car is on PCP just as a contribution to the thread. I don't understand the 'it has to be cash' mentality, you won't get a better deal for cash on a 0% PCP as the dealers loose out on their commission and you loose on the deposit contribution subsidised by the manufacturer which in my case was £1000. I also got £1000 off the car because it was in the showroom (started at £500 but made it to £1000 as the car is a 16MY) so that's £2k off making the car £10,500 with a £500 deposit so £10k balance over 3.5 years makes the car mine for £127 per month with 10kpa miles. GMFV is fixed at just under £4500 ish and that's an amount I could save for and pay off whilst still comfortably affording the car. I could even put the £9500 left over in the bank to gain interest if I had it and pay it off month by month as the finance deal is 0%. There is no way I'd be able to save up £10k to buy a car right now and why would I when the monthly payment is so low for a new car? First I'd need to save the £10k, and who knows when that would be? I still need a car to get around in and if I had done the work myself again to get my £95 stop gap Punto through an MoT it'd have lasted maybe but the inconvenience of stuff falling off and the cost of repair if I didn't have the skills myself would eat into the savings.

 

I owned my Volvo outright and am by no means incapable of saving, I am currently saving for a house deposit and that's why I've chosen not to buy used outright again :)

Link to comment
Share on other sites

Thanks for that,pretty certain I read online a few weeks ago someone was saying 'you are the registered keeper but the finance company is the legal owner and must tell your insurance that',hence why I ask.For the first time in My life I am considering buying My next car on a PCP.

  • Like 1
Link to comment
Share on other sites

It seems to be  a grey area, some conflicting advice around. When I asked the dealer they said insure it as though you own it so I asked them to write that down. They said VWFS just lend the money out and the car is yours. If it's a lease it doesn't work like that. Given how wrong they were about everything else though I am still within my 14 day cooling off period to change it if I have to so am looking to answer the question definitively. I'll have to call my insurers I suppose!

Link to comment
Share on other sites

Sasha is correct, the deals that Skoda were offering on 0% PCP this month were too good to miss. I always bought my cars outright with a bank loan in the past but it made sense to get my latest one on PCP when you consider the £1000 deposit contribution, £500 petrol card (basically £500 cash) and an extra £500 off list price from going through carwow.

Link to comment
Share on other sites

Yes,it is a grey area indeed have been doing some research on the internet and come up with a couple of interesting facts -customer services at Confused.com says for legal owner tick Company(Leased) and someone on the Octavia forum tells us on the Skoda finance form it actually states you must tell the insurance company the car is owned by Skoda!.Also put my details into confused.com and My insurer(LV) charges £10-00 more if I put in Company (leased) instead of Myself as the legal owner.Wish I hadn't asked now!.

Edited by leckman
Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • Recently Browsing   0 members

    • No registered users viewing this page.
  • Community Partner

×
×
  • Create New...

Important Information

Welcome to BRISKODA. Please note the following important links Terms of Use. We have a comprehensive Privacy Policy. We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.