Balloon payment at the end?

[ChelseaTractor]

Peeps, do you reckon this is a good way to get into a new Tiv?

The Sandbag and I were chatting about buying 'our' first TVR and saw this type of hire purchase in a dealers advert. Now, I have been looking for a good Cerb for around the 20-25k mark (12k cash rest finance), but secretly would love a Tuscan. After reading a lot of very good and informative stuff on here, I had decided that I couldn't afford to own a potentially 'bad' one and thought that a good un was way out of my price range.

with the figures that we have seen we could afford a new one (Tuscan).
As follows......

Price OTR...£39850
Deposit...£8500
48 rentals @...£472.30
Balloon payment at end...£16000
APR @7.9%

So i'd be paying about 9k for the privilige.

Going by todays prices, a four year old Tuscan is worth roughly 25-27 so if it were to be sold at the end to pay for the balloon, I should walk away with at least my deposit back and if I liked the experience, could start the process again.

Good idea? Bad idea? Waste of money? Anyone do this? Am I ?
I've had no dealings with this kind of finance so would like some advice.
Cheers.

[mustard]

Fairly standard way of financing cars these days, as long as your aware of what your entering into then then you wont have any issues.

Commonly know as PCP or Personnel Contract Hire and by a thousand and one manufactuers marketing names... options, passport, choices, etc

APR is reasonable @ 7.9% for this kind of finance and as you say you should be left with your deposit for the next one should you choose.

Wouldnt put any more deposit that what you have stated, becuase all you will do is subsidise your monthly payment

If it makes it affordable and its what you want then go for it!

>> Edited by mustard on Friday 25th June 22:37

[Wacky Racer]

Don't forget to allow an amount for regular routine servicing, and running repairs once the inital warranty period ends.....

You may hopefully be lucky and get a good one, but I have seen other owners on here recommend you allow as much as £3000 pa for these costs.....That's no mean sum....

You can't expect to run one of these beasts on a shoestring....

As long as you go into it with your eyes open I say go for it.......

[lazyitus]

mustard said:

Fairly standard way of financing cars these days, as long as your aware of what your entering into then then you wont have any issues. Commonly know as PCP or Personnel Contract Hire and by a thousand and one manufactuers marketing names... options, passport, choices, etc APR is reasonable @ 7.9% for this kind of finance and as you say you should be left with your deposit for the next one should you choose. Wouldnt put any more deposit that what you have stated, becuase all you will do is subsidise your monthly payment If it makes it affordable and its what you want then go for it! >> Edited by mustard on Friday 25th June 22:37

Mustard is spot on.

These packages were, after all, designed to get you into the car you want.

If its your best financial option, why wait any longer.

Get driving!

[fly boy]

And at the end of the 3/4 year term, if you want to keep the car rather than replace it, most finance house's will offer a new package to finance the balloon payment on similar terms.

[basil brush]

I think you may be 3 or 4k optimistic about the value of a 4 year old car.

[ChelseaTractor]

basil brush said:

I think you may be 3 or 4k optimistic about the value of a 4 year old car.

Really? Where have you been looking?
I have NEVER seen a '00 Tuscan for the money you seem to think they are worth.
Maybe you are going by what the dealer will give back but those cars from dealers are still fetching top money, 27-30.

To the others, thanks. I went to Gatwick today to sort out some figures. For the new style tuscan with the 'black eyes' and fold away convertable the numbers seem to add up.


As an aside, do all dealers use the same finance company or are there deals to be had by shopping around and playing the dealers off against one another?
I know it's not very nice but business is business and all that.

[steve-p]

ChelseaTractor said:

Maybe you are going by what the dealer will give back

That's the usual definition of depreciation. The dealer's retail price is irrelevant when you're selling, not buying.

[ChelseaTractor]

Thanks for clearing that up.

>> Edited by ChelseaTractor on Saturday 26th June 17:09

[kevinday]

Don't forget the options list is going to push the initial price up, A/C is almost a must-have, and then there are many other things such as paint, wheels, interior trim. I suggest at least £2K on top of the list price would be reasonable. If you do not then, come selling time, it may be difficult to shift.

[bennno]

you dont need air con on a tuscan convertable

bennno

[basil brush]

ChelseaTractor said:

basil brush said: I think you may be 3 or 4k optimistic about the value of a 4 year old car. Really? Where have you been looking? I have NEVER seen a '00 Tuscan for the money you seem to think they are worth. Maybe you are going by what the dealer will give back but those cars from dealers are still fetching top money, 27-30.

Well, given I paid less than that for a '00 Tuscan 15 months ago, I was going on personal experience.

[Ballistic Banana]

so i could afford a Saggyarse then

BB

[MAC5]

7.9 apr for this type of finance is extremly competive.But remember the overall cost will be more expensive than a standard HP agreement. But if it gets you into the car so what you only live once! DO IT

MAC