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Not really… I am not paying any interest on my pcp as it is 0%apr. Essentially it is a partial loan on the car that I’m 3 years I can choose to finance the outstanding amount - balloon payment - or sell car that would pay outstanding balance off. Essentially saving 3 years worth of interest that is better in my pocket than with a finance company. Just because you may choose to finance a car through a loan may mean you ‘own’ the car but you still owe the finance - and how would you settle that without selling the car or other asset? It is still your name on the V5 in either case.
Somewhere within the way the PCP is arranged or whether it’s in the purchase price of the car the cost of that money will be there …

There is no such thing as free money but there are clever salesmen who convince people they are getting something for nothing.

Lots of people like the low payments and move from one deal to the next constantly in effect renting cars and never owning them.
 

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Somewhere within the way the PCP is arranged or whether it’s in the purchase price of the car the cost of that money will be there …

There is no such thing as free money but there are clever salesmen who convince people they are getting something for nothing.

Lots of people like the low payments and move from one deal to the next constantly in effect renting cars and never owning them.
You are right, the high interest rates appear to be on second hand cars which is where the money is made, but VW finance are paying my interest costs and I’m happy with that 😊 If I want to purchase outright I’ll consider my options in 3 years time when I would be financing a much lower amount - £6600 in my case which I think is great price for a 3 year old GTI.

Go check with a dealer or on VW website, you might be pleasantly surprised 👍
 

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[QUOTE="Charliefarlie, post: 147946, member: 13704"

Lots of people like the low payments and move from one deal to the next constantly in effect renting cars and never owning them.
[/QUOTE]
Many years ago we looked to buy a new Fiat from a franchised dealer that was located in a crappy part of Glasgow, well at that time it was. The dealer was Reg Vardy, now long gone, anyway the car was advertised in newspapers, no internet then. Price was not listed, only weekly/monthly payments. I was working in Glasgow at the time and just drove in on the off chance of a decent cash deal. The salesman I asked to speak to about the actual cash price could not understand why I would want to know that particular figure as all of his customers only wanted to know how much per week it was going to cost them! He was very disparaging about them as well. So nothing new in the renting for ever game.
Peter Vardy, a relative of Reg Vardy, now employs the same system. No cash price on screens, only monthly cost. Worst dealer ever in my experience, closely followed by Arnold Clark. That is another story for another day.
Anyway, not being critical of anyone who chooses the best purchase system for them, some of us can buy for cash, some of us prefer to rent, pretty much like home ownership. Sorry about the boring story!
 

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Cash price was same as pcp price
That's pretty clear :)

But... it's unusual for VW group to offer both 0% and a finance deposit contribution on the same order. Normally you get one or the other. I think currently it's £500 deposit contribution on a 4.8% APR, or £0 contribution on a 0% APR.

How they get away with this is beyond me. I am very rusty now but the old consumer credit case law used to be clear that offering goods at a higher price if bought on credit and then claiming the credit was "interest free" was not allowed.
 

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Worst case scenario - you lost a £500 finance contribution and gained an interest free loan of about £14k, of which £7.5k is repaid over 3 years and £6.5k is paid as the balloon at the end. That equates to about a 1.4 or 1.5% APR so a very low net rate of interest. I'd be happy with that :)
 

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[QUOTE="Charliefarlie, post: 147946, member: 13704"

Lots of people like the low payments and move from one deal to the next constantly in effect renting cars and never owning them.
Many years ago we looked to buy a new Fiat from a franchised dealer that was located in a crappy part of Glasgow, well at that time it was. The dealer was Reg Vardy, now long gone, anyway the car was advertised in newspapers, no internet then. Price was not listed, only weekly/monthly payments. I was working in Glasgow at the time and just drove in on the off chance of a decent cash deal. The salesman I asked to speak to about the actual cash price could not understand why I would want to know that particular figure as all of his customers only wanted to know how much per week it was going to cost them! He was very disparaging about them as well. So nothing new in the renting for ever game.
Peter Vardy, a relative of Reg Vardy, now employs the same system. No cash price on screens, only monthly cost. Worst dealer ever in my experience, closely followed by Arnold Clark. That is another story for another day.
Anyway, not being critical of anyone who chooses the best purchase system for them, some of us can buy for cash, some of us prefer to rent, pretty much like home ownership. Sorry about the boring story!
[/QUOTE



It is the same with car ads on the TV. They never say the price of the car, only the weekly amount.

They also never tell you anything about the car, just paint a lifestyle picture. Buy this car and you will be cool. Buy this and you will always drive on traffic free roads and the Ladies will all want to date you.
 

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So been phoning around looking for a 4yr PCP deal on a 5dr UP GTI with cruise & park and seat height adjustment. So with a £2500 deposit its coming out at £240 per mth in tornado red or £254 in kings red. So far I dont seem to be able to better that.
I have ordered a new one with all the extras. 3 year PCP £2605 deposit £245 a month. 0% apr.
 

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I'm guessing that's based on a higher (but probably still lower than likely market value) balloon payment ?
 

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They also never tell you anything about the car, just paint a lifestyle picture. Buy this car and you will be cool. Buy this and you will always drive on traffic free roads and the Ladies will all want to date you.
As it turns out, by buying an Up! (well, a Citigo) all of this has come true for me. No kidding....
Except I used to be cool anyway, and my wife (CFO) is happy too - and I quote "do not waste money on any more stupidly expensive cars that can longer be enjoyed anywhere, as I can make far better use of it"....
 

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Discussion Starter · #51 ·
I have ordered a new one with all the extras. 3 year PCP £2605 deposit £245 a month. 0% apr.
Congrats what colour ?
Our deal has ended up at £241 a month over 4yrs with £500 deposit. All the major toys except climate. Happy with that and seriously believe the dealer was backed into the corner with nowhere else to go. We also plan to buy this car as early as possible.
 

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Congrats what colour ?
Our deal has ended up at £241 a month over 4yrs with £500 deposit. All the major toys except climate. Happy with that and seriously believe the dealer was backed into the corner with nowhere else to go. We also plan to buy this car as early as possible.
You can settle the finance (pay the balloon) at any time really. Maybe not in the first 6 months or so, but I'll bet that's variable. Just ask for a settlement figure, get a reference, send the cash and cancel your direct debit.
Our initial (2018) PCP deals were 6.9% so moving off this is great. The dealership will offer to refinance the balloon, but they will offer something terrible like 9.9% because they actually want you to buy a new car and not buy the old car.
With balloons of £5k and £6k it's really easy to buy a car outright, not something the PCP crowd ever really does.

Nirvana is zero car direct debits per month.
 

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I wanted to pay cash for my car but the dealer recommended the PCP deal as you’ll receive a £500 discount off the the price of the car which took the price down to just over 13k.
Told me to then ring VW finance up 7 days after collecting car and pay off the balance.
I did, so no PCP payments and £500 off the car which was a good deal imho .
 
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