PCP incentives and settling early

[P4D]

Hi all,

I’ve just reserved a Volvo V40 T3 and I was planning on buying/paying cash.

After speaking with the dealer, he mentioned that if the car is purchased on finance, they usually give you 2 years warranty and roadside cover instead of 1 year if bought via cash. He also said you will usually get 2 years servicing thrown in if bought via finance.

Is there a possibility I could get the car on finance, and settle the balance within the cooling off period but still keep the incentives?

Cheers

[Mirinjawbro]

i believe many people do this. although not sure if theyve made it harder recently.

[the-norseman]

I went into a Triumph dealer to buy a motorbike with "cash" and a trade in. Turns out if I bought the bike via Finance they would give me a discount and overall I was paying around £800 less over the full term and a few things were thrown in.

Dealers getting paid ££££ for selling finance these days.

[33q]

I have settled 3 VAG finance PCPs within days of delivery and kept all the incentives.

I even told the dealer that is what I planned to do. He said quite a few people say this but when it come to the crunch they don't.

[ZX10R NIN]

P4D said:

Hi all,

I’ve just reserved a Volvo V40 T3 and I was planning on buying/paying cash.

After speaking with the dealer, he mentioned that if the car is purchased on finance, they usually give you 2 years warranty and roadside cover instead of 1 year if bought via cash. He also said you will usually get 2 years servicing thrown in if bought via finance.

Is there a possibility I could get the car on finance, and settle the balance within the cooling off period but still keep the incentives?

Cheers

Your correct & this is the way to do it, some people wait until the first months payment has gone out.

[P4D]

ZX10R NIN said:

Your correct & this is the way to do it, some people wait until the first months payment has gone out.

So the correct way is to do it during the cooling off period, and not after the first payment?

[P4D]

An update:

I've just spoken to the dealer, and he claims they've cracked down on people doing this, so they now require you to run the finance for at least a month before settling it.

Does that sound right?

[Dan W.]

Dealer here.

Pay the first month and then settle it, Suzuki have been clamping down on people paying it off within days because you are withdrawing from the finance agreement and all its incentives.

pay first month then settle.

[shtu]

P4D said:

An update:

I've just spoken to the dealer, and he claims they've cracked down on people doing this, so they now require you to run the finance for at least a month before settling it.

Does that sound right?

It may also be the salesman gets paid commission once the first month's payment is made. For the minimal cost of doing that, I wouldn't be too bothered.

Like someone else above, I've withdrawn from agreements several times with VW, ie, phoning up next day and paying the agreement off. Typically costs a tenner or so in interest, which isn't bad value for discounts that can be £thousands. Leaving it until after the first month payment will cost a little more, but is still a huge saving overall.

[Canon_Fodder]

Check the agreement carefully for early settlement / termination penalties.

[P4D]

Canon_Fodder said:

Check the agreement carefully for early settlement / termination penalties.

I'll go through the docs once they're sent! Cheers

[P4D]

shtu said:

It may also be the salesman gets paid commission once the first month's payment is made. For the minimal cost of doing that, I wouldn't be too bothered.

Like someone else above, I've withdrawn from agreements several times with VW, ie, phoning up next day and paying the agreement off. Typically costs a tenner or so in interest, which isn't bad value for discounts that can be £thousands. Leaving it until after the first month payment will cost a little more, but is still a huge saving overall.

Yeah, according to him it's circa £51 interest per month.

[MondeoMan1981]

P4D said:

An update:

I've just spoken to the dealer, and he claims they've cracked down on people doing this, so they now require you to run the finance for at least a month before settling it.

Does that sound right?

Lets be honest. What's been cracked down on is dealers using finance to give punters a discount without costing themselves anything.

Commission models and clawback will have been tightened up, meaning if the finance is settled during the cooling off period, no commission. Finance Companies will also have been concerned at their agreements being mis-sold.

[C69]

P4D said:

I'll go through the docs once they're sent! Cheers

I'd also suggest getting the terms of the extra warranty / free servicing in writing.

[Richtea1970]

MondeoMan1981 said:

P4D said:

An update:

I've just spoken to the dealer, and he claims they've cracked down on people doing this, so they now require you to run the finance for at least a month before settling it.

Does that sound right?

Lets be honest. What's been cracked down on is dealers using finance to give punters a discount without costing themselves anything.

Commission models and clawback will have been tightened up, meaning if the finance is settled during the cooling off period, no commission. Finance Companies will also have been concerned at their agreements being mis-sold.

Exactly this.
I’ve done this several times, it’s your agreement, you can pay it up whenever you like. I’ve been given a few scare stories about what will happen if you don’t let it run for 3 months etc. But that’s exactly what they are, scare stories. They only thing that is at risk is the sales person’s commission, so it’s up to you if that bothers you or not.
Personally, I pay it off the day I collect the car, have always received the incentives/discounts with no issues at all.