PCP experiences

Can you pay off PCP early, or at any point?

Can you pay off PCP early, or at any point?

in my experience, yes you can. I just called up the finance company and got the settlement figure to pay. If you settle early though you have the remaining PCP amount plus the GFV amount to pay in order to clear the finance and keep the car, well that’s what I did. Not sure if you could settle the PCP amount and hand the car back early, I think you can do this after a certain time but not sure.

Just considering chopping the Leaf in for another Ioniq.  Obviously it would be better to sell the Leaf first then go with the cash, but that might be logistically difficult. It would be easier to go through the process with the dealer to get the new car then sell the old one afterwards and use the cash to pay it off.

Any regulated finance agreement can be ended early by repaying the balance. You would not be liable for the interest on the full-term, just what you'd paid to-date plus a nominal amount (30 days perhaps?) from the date a settlement quote was requested.

This is all clearly explained in the agreement that you read before you sign. People do read the terms of finance agreements before signing them, don't they?

Yes, but I don't have them in front of me right now as I'm not in a dealer applying for finance...

You are also given a copy of the finance agreement terms to keep for your records...

.. after you sign it ...

there is no way I would buy a personal car on finance

So what should I do? Save up £23,000?

Well, yes.

there’s always the option to spend less, on a cheaper vehicle. I know that’s not the point of this thread, but at least acknowledge that as an alternative

there’s always the option to spend less, on a cheaper vehicle

Oh wow! I'd never thought of that!

As well as settling the finance there are also termination clauses. Once you've paid 50% of the amount borrowed (including the balloon/gfv) you could hand the back the car and walk away.

In practise you won't get near 50% repaid until near the end of the contract term anyway.

If you must, a personal loan is the most economic form of credit. But, you'll need to satisfy the criteria -e.g. enough disposable income to cover the payments and it might have to be secured against the car. Obvs, you then pay for your own maintenance and suffer the S/H value, but it would work out to be less overall.

Usually, finance arrangements are what's called 'interest front-loaded'. So, in the first year or so, you pay more interest than capital e.g. a £500 payment is £450 interest and £50 capital. This ratio inverts, towards the end. Effectively this means if you come to end it early, the settlement figure could still be quite high - maybe more than the car is worth.

Well it looks like personal finance will be enough for this purpose. I can take out a loan, buy the car I want, then sell the other privately and pay off.

@finephilly does 0% finance (my last 3 cars were this) not beat a personal loan? By my maths it saves me thousands vs the interest on a personal loan, so not always the most economical loan.

o% credit card?

Yeah but who is offering 0% finance these days?

Alpine...

But that wont tow a caravan.

Yeah but who is offering 0% finance these days?

Polestar

Cupra, some Renault (arkana) some Kia (Niro) there were probably others too, but I am In Ireland.