My favourite one doing the rounds at the moment relates to the PCP packages for new cars. They mention the optional final payment. I wonder will anybody chance their arms and say, "I thought about making the optional final payment, and as it's optional, I've decided against it" and hold on to the car?
Should have put a smilie after my post - I was joking. Still, would be funny though to see their reaction.But those are optional, you generally have 3 choices. Obviously one of those choices isn't keep the car and make no further payments, but it's still optional all the same.
Should have put a smilie after my post - I was joking. Still, would be funny though to see their reaction.
Firefly .
PCP is a bit like the Tesco advertisement
{the more you spend the more you save}...
ps, hope the oul cars hold out.
From a dealer perspective, they're looking to get you used to paying a monthly amount. And, they'll hope that the option of a shiny new car in 3 years time will tempt you to keep rolling over for the rest of your life. That way they maximise the revenue from each customer, and keep .
Out of interest what's PCP?My favourite one doing the rounds at the moment relates to the PCP packages for new cars
Out of interest what's PCP?
I'd rather stick with the car I have and build up the bobs until I actually need to replace the car.[/QUOTE said:WHAAAT ??.Actually save up for something BEFORE you buy it. What a novel idea, it might actually catch on. Oh come to think of it that’s what we used to do before the Celtic tiger arrived bringing with him the “because I’m worth it “generation.
The problem I see is that if you owe 10k and the car is only worth 10k, then when buying the next car (option 3) you are now doing so with no deposit. This would indicate to me that you would need to make much higher payments or else you would have a much larger balloon payment on the second and subsequent cars. All the while getting into more and more obligations just to change the car!
It sounds too good to be true to me anyway. I'd rather stick with the car I have and build up the bobs until I actually need to replace the car.
But the success of these deals is the fact that people can keep on paying €250 per month continuously and always have a relatively new car. Most people don't care that they never really own the car and are just technically leasing it.
When the 3 years is up, they get a brand new car for roughly the same money, and on and on.....buyers happy and dealer happy, as they keep getting rid of new cars.
So, to pay for the next car then you would need to come up with another 10k deposit to have the same 259e pw payments. Otherwise, if you only pay 259e (with no new deposit) you would then have a balloon payment 24,176 on the second car (RRP 33,500 - (259*36)).
That's exactly it. I got a quote from a dealer recently and proposed paying the 30% deposit, he advised against it so I wouldn't have to come up with the deposit the next time around. Essentially, they want to stretch you to the maximum monthly payments you can afford, and keep the money train rolling on forever.
The VW example above is on 0% finance, you can be sure if they survive the emissions fallout, in 3 years time they'll be charging 7-8% on the money required to keep the deal rolling.
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