Agility finance

[Gkinghorn]

the problem with all of these PCP deals is 2-fold.

1. The car is never worth what they say it will be worth at the end of the term - If you take the balloon payment you buy a car with negative equity right away.
2. If you hand it back you give up your deposit and have to save a new deposit up to buy another one. People rarely factor that in in my view.

The really ought to do zero deposit and just do the whole thing over the number of years you want the car on monhtly terms .. but they wont becuase the monthly figure will be too high for most folks and you never own it anyway.

I think unless you just buy it outright with 0% APR under one of their deals (or elsewhere) then at least you can decide when you sell it on or keep it...

PCP sucks .... tried it 4 times.. it sucks...

 

[sw20gts]

the problem with all of these PCP deals is 2-fold.

1. The car is never worth what they say it will be worth at the end of the term - If you take the balloon payment you buy a car with negative equity right away.
2. If you hand it back you give up your deposit and have to save a new deposit up to buy another one. People rarely factor that in in my view.

The really ought to do zero deposit and just do the whole thing over the number of years you want the car on monhtly terms .. but they wont becuase the monthly figure will be too high for most folks and you never own it anyway.

I think unless you just buy it outright with 0% APR under one of their deals (or elsewhere) then at least you can decide when you sell it on or keep it...

PCP sucks .... tried it 4 times.. it sucks...

This is my sentiments at the moment... I've never tried PCP but now I don't think it's worth the risk...

 

[wi-fi]

the problem with all of these PCP deals is 2-fold.

2. If you hand it back you give up your deposit and have to save a new deposit up to buy another one. People rarely factor that in in my view.
PCP sucks .... tried it 4 times.. it sucks...

I thought paying the required deposit is only to bring the payment/instalments down.
I believe you can pay less deposit but monthly payments will go up!!

 

[orb the Impaler]

PCP sucks .... tried it 4 times.. it sucks...

I tried buying a 2002 SL500. It sucked and cost me more than I dare to add up. Worst car I have ever had. And the best.

Now I have a brand new car on Agility. In two years I will give it back and get another. It will not cost me anything in repairs. The monthly cost is less than the monthly cost of repairs to my SL.

You pays your money.

Also - on Agility you get the option to simply give the car back. I like this as I have never ever got near the "book price" when selling a car.

 

[Gkinghorn]

I thought paying the required deposit is only to bring the payment/instalments down.
I believe you can pay less deposit but monthly payments will go up!!

It is BUT you could equally put that money into a savings account , earn some interest and use it to pay the differenc ebetweem non deposit and deposit payements.... at the end of the day it's just pre-paying the car.. why pre-pay???

 

[sw20gts]

Now I have a brand new car on Agility. In two years I will give it back and get another. It will not cost me anything in repairs.

Correct me if I wrong, but to get another you will have to settle the GFV first or come up with your own deposit for another car?

Why don't it cost anything on repairs ? I was told service plans are not included in Agility?

 

[Rory]

It is not a scam at all. It is simply good business. What good businesses try to do is to find out what customers want and offer it at attractive prices. PCP's offer a simple way of spreading the cost of car ownership evenly over a three year period. You pay the depreciation and interest on capital month by month as you go along. Very like renting a house instead of buying one.

MB can borrow money at very low rates (much less than most of us can) and they can provide relatively cheap finance to us to help sell cars and keep the wheels of industry turning.

Of course they can offer deals to Lombard and others to help move the metal. Why not?

..because it's supposed to be illegal to offer different prices for credit or cash yet you can't get the same deals if you're a cash buyer.

They encourage credit purchasing because it's a trap that is very difficult to get out of.

Look at the kind of questions the person who re-started this thread is asking. He's in a position where he can afford to finance a £50K car (after getting out of the deal on his current car which still has 50! months to go) yet he appears to have no idea what he's getting into. He's got a long thread on PistonHeads running where he volunteered that he didn't understand the deal he was being offered. He said the salesman has been all over him like a rash to close the deal - with the figures being shown, no wonder!

 

[jberks]

the problem with all of these PCP deals is 2-fold.

1. The car is never worth what they say it will be worth at the end of the term - If you take the balloon payment you buy a car with negative equity right away.
2. If you hand it back you give up your deposit and have to save a new deposit up to buy another one. People rarely factor that in in my view.

The really ought to do zero deposit and just do the whole thing over the number of years you want the car on monhtly terms .. but they wont becuase the monthly figure will be too high for most folks and you never own it anyway.

I think unless you just buy it outright with 0% APR under one of their deals (or elsewhere) then at least you can decide when you sell it on or keep it...

PCP sucks .... tried it 4 times.. it sucks...

What you say is true, but surely it's not the fault of the seller but the buyers. You don't have to pay what they quote you after all. People always seem to get dazzled by the monthly payments and ignore the cost at the end. Then complain when it arrives.

I've bought on PCP deals but gone in with my eyes open and calculator to hand. So, when I bought the Audi, I added up the deposit, the payments and the balloon to come out with a true cost. It's not exactly complex maths after all. I then figured out what the car is really going to be worth at the end and compared that to the balloon. I wanted to ensure that at the worst, the deposit I paid was still in the car. Hence I looked at the monthly payments they quoted and told them to increase them until the balloon was down to a certain figure. Ok, it cost me more per month than it could have done but the payments were more in line with reality and when the deal came to an end I actually got a little more back than I expected.

A couple of years later the wife wanted a Jeep. I said provided the payments are no different, ok. She spoke to a dealer who said they could do this and rang me to go through the numbers. Sure enough, the payments were the same. However, her current car was worth £6,000 more than the outstanding finance. At the end of the lease, the Jeep would at best be worth what we owed. So my £6,000 would have gone to massage the monthly payments and in reality I was right all along, we couldn't afford a new jeep. We bought a used one instead.

So the deal works for some. Those with company car allowances for example. You get a car you couldn't otherwise afford, for a fixed price. Ok you never own it and expect to hand it back after a period but thats fine. you get another one. Just make sure the deposit is worked in.

For me, no it doesn't make sense. I buy my cars outright these days and just keep them. I don't get new ones as I can only afford something I wouldn't want. Basic or poverty models. Instead I buy what I do want with a couple of years on it.

 

[Gkinghorn]

dont disagree - you have to go in to these things with your eyes open.. and i did 4 times.... finally decided it was better just buying outright with a loan... but you are aboslutely correct in your assertions...

 

[wi-fi]

Ok you never own it and expect to hand it back after a period but thats fine. you get another one. Just make sure the deposit is worked in.

But anyone have the option to buy the car!!!
The options are,buy,walk away,singn -up for a new pcp!.
In the same breath if you opted to buy the car from the start how much your car then is depreciated after 2 or 3 years???you probably find out similar sums!!?

 

[lwbnick]

..because it's supposed to be illegal to offer different prices for credit or cash yet you can't get the same deals if you're a cash buyer.

They encourage credit purchasing because it's a trap that is very difficult to get out of.

And it's the only real way they have to sell cars, bit of a double ended trap.
People with no real assets get to drive around in new very expensive cars that they can't actually afford other than hiring them. Mercedes shift stock, but are they making any profit and are their new customers really the sort of customers they want?

 

[wi-fi]

And it's the only real way they have to sell cars, bit of a double ended trap.
People with no real assets get to drive around in new very expensive cars that they can't actually afford other than hiring them. Mercedes shift stock, but are they making any profit and are their new customers really the sort of customers they want?

Why is is difficult to come out ?,i have replaced my car mid agreed term not a problem whatsoever! just like HP!,.I have looked at my current car gvf in my case similar car age and spec selling now for 3-4k more from dealership! so win-win,but i suppose not the case for every car

 

[Rory]

Correct me if I wrong, but to get another you will have to settle the GFV first or come up with your own deposit for another car?

I don't get why you constantly talk about having to settle the GFV.

The normal way these things work is that at the end of the term the car will be worth about the same as the GFV - maybe a little more or maybe a little less, but there won't be much in it.

So you have 2 options.
1) Pay the GFV (maybe by taking out a loan) and keep the car.
2) Hand the car back and walk away with nothing. If you want another car on another PCP then, yes, you have to find the deposit.

The thing is, money-wise, they both amount to the same thing. On the last day of the term you have nothing. If you pay the GFV to keep the car, it's just like going out and buying any used car - of course the benefit of buying the one you've been driving for the last couple of years is you'll know if it's any good or not.


What should happen is that rather than you borrowing the money to pay the GFV, the dealer should work hard to convince you that that's not a good idea and will try hard to get you take a new car on another PCP. You'll say "Ooo...a new car" and sign up. In all honesty, for people who live their lives on finance it probably does make the most sense to take the new car. This, to my mind, is the "trap" in PCPs.

Why don't it cost anything on repairs ? I was told service plans are not
included in Agility?

The car will still need to be serviced, but warranty will cover anything that fails and over a couple of years there probably won't be much in the way of wear and tear items except, on a SLK55, you're probably going to get through rear tyres.

 

[orb the Impaler]

Correct me if I wrong, but to get another you will have to settle the GFV first or come up with your own deposit for another car?

Why don't it cost anything on repairs ? I was told service plans are not included in Agility?

The GFV is just that. Just give the car back at the end of the term. Coming up with a new deposit is no big deal - it's about £1200.

The car has a warranty - therefore I won't have to pay anything beyond servicing (won't be much over two years) and tyres.

You need to remember that I have come from running an SL which has had everything that can go wrong happen to it. Sums of money like tiny little 245/18 tyres and service bills are a mere bagatelle after the horrors that I have suffered

 

[Xtractorfan]

It is a system for giving people what they want at what they can afford. Car companies do make money because their products have been extremely well priced..in their favour..
The credit companies make money as well ..normally in bonuses from the Car companies,
So everyone is happy, and the customer has a new car.

 

[Rory]

It is a system for giving people what they want at what they can afford. Car companies do make money because their products have been extremely well priced..in their favour..
The credit companies make money as well ..normally in bonuses from the Car companies,
So everyone is happy, and the customer has a new car.

I'm not happy. :sad:

I don't need credit but yet the only way to take advantage of the supported pricing is to take credit - which then funds the support!

So MB gets more money off me as it doesn't have to give me the special pricing, or MB Finance gets money off me if I take the credit deal.

 

[Rory]

Coming up with a new deposit is no big deal - it's about £1200.

Well, it's £6K on the SLK55AMG that the recent poster is looking at.

 

[Gkinghorn]

Tend to agree the deposits generally are much higher ... If you check out that merc site mentioned earlier i saw them at that level or more...

£1200 just means you pay higher every month..


Its an emotive subject i guess .... All pcp really does is enable you to borrow less initially and never own the car outright...( you do after so many payments but you know what i mean). So instead of needing a £50k loan you get a £20k loan or so...

 

[sw20gts]

Thank you everyone for being so patient and understanding with my questions I've never took out a PCP deal before and this discussion has really enlightened me.

I think for me, in the end of the day I would prefer a traditional HP deal. I feel I will have more control over the payments and I have the option to settle large chunks or even settle early as I wish.

PCP is interesting as well as I can afford a much newer car however I think I will only be tempted with much lower APR

 

[orb the Impaler]

People with no real assets get to drive around in new very expensive cars that they can't actually afford other than hiring them.

What a load of old bollocks!

What my SLK is costing me over two years is, by back of fag packet calculations, little more than the depreciation would be over the same period. I certainly wouldn't like to risk trying to trade in or sell the same car if I'd bought it outright - maybe I'd manage to sell it for the same amount as the gfv. Maybe I wouldn't. It's a gamble. I'm not a gambler. I'm also terrible at getting decent money for my cars (see threads passim).

Or I can keep my money in the bank, rent the car (where I have no risks and fixed outgoings). I have no desire or intention to ever run an expensive Merc out of warranty again (again, see previous threads).

As to "no real assets" and "can't actually afford" - what a load of utter ****! If I wanted a new one I'd buy one.