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When is getting a car or bike on a PCP deal worth it?

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Ribenapigeon
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PostPosted: 13:03 - 08 Mar 2014    Post subject: When is getting a car or bike on a PCP deal worth it? Reply with quote
When are PCP deals a good idea?
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wr6133
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PostPosted: 14:09 - 08 Mar 2014    Post subject: Reply with quote
Never in my opinion but I have the unfashionable view that I'd rather own something crap outright than owe on something shiny.
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Ribenapigeon
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PostPosted: 14:52 - 08 Mar 2014    Post subject: Reply with quote
wr6133 wrote:
Never in my opinion but I have the unfashionable view that I'd rather own something crap outright than owe on something shiny.


I used to think that having been brought up in the seventies and the culture of "never on the never never" but i've changed my mind. My bike is on a straightforward loan. I may be getting a new job soon though and be a few hundred a month better off. The milage I do on a bike clearly makes PCP not worth it but i've never done more than a few thousand a year with cars. I'm thinking I might get a little runaround with the extra cash and you can get some dinky little Micra or Fiet 500 for very little per month. It looks basically like cheap car hire with a swap for a new car every few years.
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chickenstrip
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PostPosted: 15:41 - 08 Mar 2014    Post subject: Re: When is getting a car or bike on a PCP deal worth it? Reply with quote
Boozehawk wrote:
When are PCP deals a good idea?


This is something I've been giving a good deal of thought to lately, mostly because I'd like to get back to where I was years ago, when I could chop and change my bikes regularly to try all the new stuff around. It certainly made for very enjoyable biking.

However, I've come to the conclusion that you are better off having a decent bike, one that you really get along with, all paid off first. My reasons for this are that most PCP deals have mileage limitations, and the bike has to go back at the end of the contract at an agreed level of condition.

This would be a problem for me, as I want to do a fair bit of touring - last year, I put 9500 miles on the clock between the beginning of June and the end of November, without doing a touring trip.

So I would look at a PCP deal for a second bike, that I could trade for the latest shiny thing I fancy trying at the end of each contract, keeping it in excellent condition and within the agreed mileage limit. Then, any further mileage I want to do can be done on the bike I own outright.

Bear in mind also that a bike on PCP has to have all it's servicing done pretty much on schedule, by a recognised, approved dealership, with all the extra you pay for that. No getting lazy with it, or cutting the costs by doing all the work yourself. At least, that's what I gather from what I have read, but I'm also very interested to know more too if others know better.
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Kickstart
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Joined: 04 Feb 2002
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PostPosted: 15:48 - 08 Mar 2014    Post subject: Reply with quote
Boozehawk wrote:
I'm thinking I might get a little runaround with the extra cash and you can get some dinky little Micra or Fiet 500 for very little per month. It looks basically like cheap car hire with a swap for a new car every few years.


While the headline deals on the Fiat 500 do sound good they are based on 5k a year (over 4 years I think). If you do that low a mileage then possibly not a bad deal (although the Chrysler badged Lancia is even cheaper).

All the best

Keith
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The Artist
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PostPosted: 15:48 - 08 Mar 2014    Post subject: Reply with quote
I wouldn't buy anything under the influence of PCP. Not a smart thing to do.
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JonB
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PostPosted: 15:58 - 08 Mar 2014    Post subject: Reply with quote
They obviously have their place. But I believe having a financial asset to your name is better.

My current car I obtain via a personal loan at 4.9%. I own the car outright, I just owe the bank for the loan. If things go awry then I can always sell the car to pay off the debt.

This is where buying a used car pays dividends also. The current value of my car is still more than the amount owed on the loan.
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Harold_Shand
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PostPosted: 16:19 - 08 Mar 2014    Post subject: Reply with quote
You pay the final payment to own the vehicle ( this negates the mileage issue ) then sell it privately, et voila, your next deposit.
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Harold_Shand's theory might be the best explanation.
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Llama-Farmer
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PostPosted: 16:35 - 08 Mar 2014    Post subject: Reply with quote
PCP would never work for me I don't think. Would rather go the hire purchase option and pay more each month, but less in the long run. At least then you own the car or bike without a lump sum at the end.

I'd rather buy my bikes outright, they tend to be less expensive, so if I save up a couple thousand a year, then I can buy a used bike in maybe two years, and a new bike in several.

Car on the other hand, considering the mileage I'd be doing, and the amount of space I'd need, and towing ability, I'd be looking at a nearly new 5 door estate, BMW 3 series touring is what I've got in mind. I'd keep it til it was either costing more each year (in servicing/repairs etc) than replacing it would, or if it was getting too unreliable.
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andys675
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PostPosted: 18:17 - 08 Mar 2014    Post subject: Reply with quote
PCP:-it's a new bike cheaply, deposit 10 to 20 percent

pay lets say £75 a month for 3 years, at the end you owe less than it's worth, use the difference as a deposit on your next new bike and start over again, or pay off the balance and keep it

normal bike loan:-

deposit, and pay £180 a month for 4 years and own the bike

are you going to keep the bike forever or change it every 3 years?
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t121anf
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PostPosted: 18:29 - 08 Mar 2014    Post subject: Reply with quote
I've never liked the idea of PCP but when I looked to buy a new car the amount I was willing to spend per month over a sensible time wouldn't get me anything decent.

Doing PCP allowed me to get the car I want and a price I can afford, on paper I can sell and make a profit after the term.
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