PCP car finance- what are my options if I want to get out of it?

[Mysteriousgirl2]

I bought a car on PCP in Sept 21. The car doesn’t suit our needs so I need to change it. It’s a 49 month contract, with an £8k ballon payment at the end. It’s costing me £328 a month and is 8% APR.

Also, I’ve been saving and would rather have a cheaper secondhand car that I buy from savings.

What can I do in this situation?

What does it say about early termination in your contract?

You have a right to terminate the contract when you have paid half the total payments, but this won't happen until around 3 to 3.5 years into the agreement.

You need to talk to the dealer. If your current car is one they can easily resell, you might be able to terminate the agreement without huge cost, especially if it frees you from paying relatively costly finance for the next 2 years or so.

@BrokenWing I can’t do voluntary termination until April next year.

@BarbaraofSeville I can either pay a settlement fee of £15K to own the car outright or pay £3500 to hand the car back.

I think the car is worth around £11K if I sold it privately, so I would be losing money either way, but I want to get out of the contract to get a car with better range.

Would you be going for a PCP agreement again? If so the chances are you will be able to swap early, however any outstanding balance will be added to your new deal. It’s maybe worth an ask, however if I was you I would wait for the deal to end, hand the car back and never touch a PCP deal again. Unfortunately I have been burnt in the past and the finance companies show no mercy!

Hi @Glitterb thank you for your reply!

I don’t want to buy with PCP again, if I’m honest. Would rather buy a vehicle with savings, and then carefully put a bit of money aside each month to replace/upgrade that car if I need to.

This is my first venture into PCP and I can really see how garages get you into buying again on PCP when you want to change car- it’s like a treadmill that it’s tricky to get off I think.