How much do you spend on PCP?

[Brumbrumbrumbrum]

I feel that I need to get this out of the way because I've seen threads derail previously but I'm going round in circles so please do help!

yes this is a first world problem
I don't need opinions on PCP, this is the best way for us to do things for many many reasons I won't bother getting into here
I'm both nosey and curious

I'm torn between two cars.
Both SUVs. (2 young teens with huge amount of sports kits, 2 big dogs)

I roughly do 1200miles a month so I'm in the car a lot.

Car 1. One down from top spec. 1.3 engine so I suspect will be a bit sluggish with weight of car. Nice interior, I do really like it. 3 year warranty. £300 pm.

Car 2. One down from top spec, but a sport version so has some aesthetically appealing additions. 1.6 turbo engine, nicer interior and gadgets than car1 and 5 year warranty. £360pm. Heart really wants this one...

The reason I'm dithering is because both are significant hikes in our current PCP- 4 Years ago I was over cautious because of £ and we didn't get an SUV, meaning our payments were £230, but subsequently we've had a car that's on that annoying side of just not quite big enough, making things logistically difficult at times.

In theory, we can yes afford it. Our income has significantly increased in this time, but I'm naturally cautious and tend to worry about losing jobs etc. Some financial commitments are due to end in the next 6 months which would more than cover this hike in bill.

Both cars are big enough, but in the same sense that I was too cautious last time and didn't get what I wanted, and it's always niggled me, do I just get car 2 because ultimately that's the car I prefer?

Husband think 5 year warranty is important because when our 3 y warranty ended on current car, we almost immediately had a technical issue which would have been covered had it still been in warranty. He also isn't worried about the money but I'm higher earner and generally manage finances.

But the little poor child deep inside keeps creeping up and telling that its a stupid amount to spend on a car per month.

What does your PCP cost you?.

A PCP is not a mortgage agreement, numerous sites online say you can hand back at the end of a deal and negative equity is only an issue if you want to terminate early. I thought the whole idea of a guaranteed future value was it was, well, guaranteed!

You are mixing yourself up and have no idea what you are saying.

Yes, you can hand a car back after half the PCP term has elapsed. That has not nothing to do with neg-eq as long as each of the payments covered whats in the agreement. Duh.

Neg-Eq is when you wish to have a newer car, and the one you have has lower market value. Hence the neg-eq.

The GFV is what the vehicle will be valued at the end of the PCP.

The balloon payment is usually smaller than the GFV, hence why you have option to buy the car outright.

OR

Use the GFV as a "deposit" against a new car, thus starting the PCP process over again.

Yes I'm a shit tonne over original agreed mileage (life unexpectedly changed about 3 m after taking the car inc a move to a very rural home, typical!) Hence neg equity on my current car.

stopwining is that pcp or lease?

Oh, so the negative equity is excess mileage charge, that does make more sense.
I honestly think you will find leasing from a lease company cheaper. The cars come from the dealers and you have more flexibility on the deposit.

You are mixing yourself up and have no idea what you are saying

No, the OP has confused matters by talking about negative equity at the end of her PCP agreement. What she actually means is she's gone over her mileage allowance which isn't the same thing. At the end of a PCP agreement you can hand the car back without further payments, even if it is worth less than the GFV as long as the terms of the PCP have been adhered to in terms of mileage etc.

I found the deals much much better on 1-2 year old cars.
I got an 18 month old top of the range for £300 per month.
I now have an audi which is £200 per month however it was 2 years old when I got it.

In answer to your question I wouldn’t pay that much for a Renault. I would rather have the slightly older VW/audi/seat.

Can I raise two points op

I’ve had the Renault as a hire car from work and it’s a shit car

Also most PCP is over 8k miles per year, you’re almost double that, are you basing the costs on your actual mileage? Otherwise you’ll get hit with a hell of a bill at the end for excess mileage.

I’ve got a seat ateca fr sport like LoonyLunaLoo and pay £250/month. But not sure you can compare really as I put down a big deposit as I didn’t want to pay more than £250/mo.

If you don’t need to be higher up in an SUV, definitely look at the lower down version its based on (if there is one) and then look at the estate cars out there to compare as it sounds like you need the extra boot space (2xdogs and sports kits) so a ‘compact SUV’ is probably going to be another car ‘not quite big enough’.

RJ yes part of the reason the pm £is so high is because I'm asking for a min 15k allowance (i think i actually need 18 tbh) as i don't want this to be same issue next time around. That and because i don't want to put down a deposit (because we have other financial stuff going on right now I'm paying big chunks for ... some holidays and bits on the house, so trying to reserve cash)

The leasing is looking cheaper pm, but there appears to be more flexibility with pcp. Garage are saying that trying to end a lease early for ex. Is hard and costly, but if we ran into trouble with pcp they'd be able to discuss buying car back from me for ex. The other thing he mentioned was if i go over mileage, but then do another pcp (likely) that the mileage isn't so much of an issue, but with lease I'd have absolutely no way out of that bill.

The leases are again only coming up cheaper if i put a good few k deposit down, which if i put the same down on the pcp .. for example 3.5k dep on the Hyundai brings the monthly down to 250... in which case I'm better off putting into PCP in terms of better position for next pcp right? But as i say, could really do with not dipping into cash savings right now.

This is really helpful though thank you- I'm just in my own head with it!

@Brumbrumbrumbrum it's a PCP - direct from Land Rover too

I pay £350 for a Ford Focus st line x with 12k allowance and that's over three years with a deposit of just over a grand I think it was. I do wince a bit when I see the money go out, but 0% PCP was a far better option than buying second hand on finance etc. We are at a point where we want the flexibility of changing one car and PCP gives that. We own our other car. I dare say we will keep the PCP car if it still meets our needs in 2022, but you never know.

For £60, if you can afford it go for the one you really want! You have to like it for a long time. I love mine. Absolutely didn't want a slug. My mpg isn't amazing (under 40) but it's nippy, very comfy and has lots of space.

Obviously OP you do what you like, but be wary of taking up a pcp just to save dipping into cash now. Work out the total cost for the length of the PCP vs a lease (via a leasing co. Not a dealer) over the 3 / 4 years. Convenience of not dipping into cash now may cost you £££££ over the loan period, especially if the pcp is not interest free.

Also, my dealer said they get a sale and comission for a pcp sale but not for leasing, so a dealer has limited interest in giving a good lease deal. At least check out the market to compare the dealers leasing deal to others.
Also, March is not a great time to buy a new car, as its a busy time due to the new reg. Can you wait until after, even May June when the dealer is trying to get rid of the pre reg cars they brought in for March but could not sell?
Finally, my other top tip is to keep negotiating on price right through the month as by the end of the month, the dealer is trying to hit their targets and will give their best price.

I would highly recommend looking at a lease rather than a PCP if you have no intention of paying the balloon payment. You will have a lower deposit and probably lower monthly repayments but you can’t buy it at the end.

I have an Audi Q3 for £285 per month over 4 years with 12k allowance. It would be not much more to increase that.

You can buy lease cars at the end of the contract. My work leases cars and the users often do this.

Im searching but not finding any of these amazing lease deals you are all finding!

Car version of find me a house and 3... 2... 1 gooo

www.fleetprices.co.uk/

I’ve found these guys to be excellent

Leasing vs pcp deposit, can someone help me organise my thoughts?

If i pay out £ cash deposit on a lease, i hand the car back end of term but will almost certainly need another lease (or pcp) will have nothing to move forward with.

Paying out £ deposit for a pcp, will surely help me for next pcp, with a bit of equity in the car?

It's just maths.
For me. Car lease is say 200 pm. Let's say 3 mthd deposit. 600 down plus 36 x 200.
Compare that calculation against what you know you will pay for Pcp, less anything you are guaranteed to get back. (Not vague promises).
If you wanted to, you could save the difference .
Leases are sometimes cheaper because the brokers get bulk discounts and access to competitive finance deals .

They both sound quite pricey to me. However,I wouldn't pay 300 a month for the car in option one,so would choose option 2. Option 1 would be something I'd begrudge paying that for by the sounds of it.

However, depends what car it actually is. Haven't read all the replies so not sure if you've revealed this.