How do people afford to PCP brand new cars?!

[JusWunderin]

DH recently mentioned looking into us getting the car I’ve had my eye on for many eyes now. But we’ve looked at prices for financing one and my good god alive it’s not what I expected!

I’m struggling to imagine someone having £400 a month to comfortable pay for a car, we had a budget of about £200 a month.. which I thought would get me something pretty nice!😂

My heart is a little sore, I’ve never really had anything ‘proper nice’ we don’t buy anything designer, branded/luxury. We live modestly, both work full time in what we thought were good jobs on relatively good money for where we live. this car was the one thing I just thought would be my little bit of luxury in life.. but it turns out it’s quite far out from ‘a little bit’ of luxury 😂 it’s big luxury and now I’m pretty gutted as I can’t imagine us ever having that sort of money to fork out every month for a car 😅

If you lease/brought a brand new car recently.. how? What job do you do? How much do you earn (if you don’t mind me asking)? I need to know where I’m going wrong 😂

First of all, rather than looking at specific cars, look at your budget. If you’ve got £200 a month, then use a search engine to look for cars that cost that to PCP or lease.
DH and I both lease cars. They cost £250ish a month each. For years we made do with old bangers but once the kids left home we had more disposable income. We choose to use some of it on new cars. Our combined income is around £50k - but we have no mortgage / rent to pay.

Only £350 for the first 5 years, and then saving £100ish/month for the 2nd 5 years.

At the end of it I own the car, no balloon payments.

I also have £12k+ in the bank and last 10 year old car we sold for £3.5k.

Don't buy brand new and make sure you have a chunky deposit first

All the people on here saying they x per month on PCP are not sharing the fill picture of the deposit payment and final bubble payment. PCP sounds cheap until you look at the reality.

My current car is on PCP and I will never make the same mistake again…the payments are not the issue (it’s not an expensive brand) but the car has broken down several times, it’s been in the garage more than with me this last year (and that’s not an exaggeration), the garage I bought it from told me it’s so faulty they would have refunded me and taken the car back if I owned it. Unfortunately the finance company are refusing to agree and won’t let me reject it. I now hate the car and I’m waiting on the ombudsman to act, the company have not handed over documents that have been requested many times and are making it as difficult as possible. My next car will be owned by me from day 1!

My deposit was £99 for the transport to get the car to the showroom.

It was second hand but had less than 10,000 miles on the clock.

Technically I could afford it as £400 is what I pay month into my savings.
The problem with PCP is you are never paid off if you keep updating your car
I would much rather pay £400 a month for a few years then own the car and go back to saving.

I wouldn't do it again either, FlyingFlamingo, warranty issues and I don't like the dealership. If I wanted to do this again I'd go directly to the dealer.

Hope the Ombudsman route works for you, sounds like a nightmare.

But at the end of it you'll own a 7-8 year old car ? And be in the same position of needing to sell a car, take a personal loan to buy another nearly new.

I don't think either is right or wrong, just preference but I certainly don't think PCP is a significantly more expensive method of having a car.

What car did you fancy?

We did before, was fine at the start but then our mortgage jumped up along with our childcare and our electricity and suddenly we were in huge trouble. We’d pick a bill not to pay every month🙈Was our first time having a car never break down on us and was amazing but it was stupid of us to take it on! What made it worse was all the comments about how lucky we were, how rich we were etc, while getting final notice letters, threatening letters from the bank and watching our credit rating die a death!!

Deposit was my old car traded in. Balloon payment is optional, I intend to hand the car back trading for a new one on a new deal.

If owning the car at the end of it is important to you then that's a key consideration. Having been driving a new car for the last couple of years I have no particular desire to go back to owning an 8-10 year old car outright anymore as it don't feel that offers me anything other than the risk of being liable for costly wear and tear, and maintenance.

Paying a regular monthly fee for a regularly updated car rather than ultimately owning an older one sounds like a good deal to me. I may change my mind in future, the wheels may fall off the concept in future and I have to buy outright but right now it works for me.

@LyingWitchInTheWardrobe yes it’s been horrendous…it really annoys me that although my investigator has sided with me, all the finance company have to do is ignore his emails and it will have to get looked at again which takes months. There’s no incentive for them to help at all, in my mind if they fail to take any part in the process it should automatically go in the customer’s favour

I've just bought a brand new car (Hyundai i10)
Paid for in cash.
Haggled on the price so had a small discount
Currently unemployed student but trainee teacher so used my bursary to pay for it. Planning on running it until it's 10/15years old

It's funny, in the old days a new car was a sign of wealth, now I see it as the complete opposite and a massive drain on disposable income.

You may well find that that is what happens ultimately, FlyingFlamingo. Of course, it doesn't help you right now, it will take time, months even - but the key premise of an Ombudsman's decision is that parties co-operate and communicate. If one doesn't then that is (from my experience) a black mark against them and definitely affects the decision.

Fingers crossed for you.

I have a 14 year old small car which I will drive into the ground....cost me £5000. Dh pays £280 a month for his car.

@LyingWitchInTheWardrobe thank you

Why speculate on something that you'd never know? Some people have the money for new cars, some don't.

There are some smug posters on this thread (as per). People who need a car may not have access to outlets/financing/cash that others have. Or they might. Either way, it's their money, their payment plan and absolutely nothing to do with anybody else.

Impotent judgement is the best you can manage.

100% agree. I see so much of this where I live. It makes my head hurt.

Our brand new EV costs £450 a month which includes all insurance, servicing etc. It's through my work so there are tax efficiencies there. Without that it would be around £700.
We earn £160k between us and it's our one car. It doesn't take up a considerable amount of our monthly income and we save a lot as it's an EV. Our next car will be a second hand one though as it does feel a bit extravagant for us - we're not flashy people. I honestly think some people prioritise their 'wheels' over many other things as a status symbol. And for them, it's worth it.

@RollaCola84
I think that just depends on your luck
My car is currently 13 years old and still runs really well
The money I am not paying monthly for a car means if it does go I have the savings to buy a new car outright

PS I am not even that precious with it. Always street parked and it has just hit 200K so not a mega low mileage.

You can get 0% finance deals so you’re just paying off the cost.

You can also get a pcp on good used cars which will be more affordable, but 200 month won't get you anything much tbh.
We've recently saved up and bought a second hand car. Sick of monthly payments. We are trying our hardest to be 💯 debt free.