Car PCP - What am I not understanding?

[vetran]

£400 a month

[LondonManc]

£400 a month

Depends what he's got to be fair.

[Gibbon]

I'm on my third PCP vehicle and to be honest I'm not sure I'll be doing it again. At first it seems like a great way of getting into a new vehicle, and having had brand-new company cars up to that point I was reluctant to go back to second hand, but I'm now half-way through a 4 year deal with a car that's currently worth less (by about £2k) than the outstanding debt.

Have a careful look at your credit agreement, if it's regulated by the 1974 consumer credit act then it should have a termination clause. Once you have paid half the agreement amount you can hand the goods back with no prejudice. There is an Industry standard for auto wear and tear (Google it). If you don't have the detailed credit agreement then ask for it, they don't like you seeing the termination bit. I've done this with three cars and my credit rating is unaffected.

[LondonManc]

Have a careful look at your credit agreement, if it's regulated by the 1974 consumer credit act then it should have a termination clause. Once you have paid half the agreement amount you can hand the goods back with no prejudice. There is an Industry standard for auto wear and tear (Google it). If you don't have the detailed credit agreement then ask for it, they don't like you seeing the termination bit. I've done this with three cars and my credit rating is unaffected.

That's the one thing I don't like about PCP - you don't have any equity in the vehicle. It's an absolute win-win for the car dealers, who are in effect providing you with both the bank loan and the collateral that covers it.

[gables]

Another vote for lingscars here, the customer service was exceptional. Maybe its who she deals with but for any extra mileage I'll only get charged 2.7p whereas the dealers I went into were nearer the 8p mark. They (dealers) also took a sharp intake of breath when I mentioned that I needed a 20k/year deal.