Main dealer contributions- better value?
Discussion
A lot of dealers offer deposit contributions- does this make it better value?
Eg;
This vehicle is available with a Finance Deposit Contribution when using Audi Finance , Plus all vehicles 2-5 Years Old Come with the choice of 2 Free Services or One Year Extension to The Audi Warranty when purchased using Audi Solutions excludes S, RS . R8 , W12 A8 Models
Eg;
This vehicle is available with a Finance Deposit Contribution when using Audi Finance , Plus all vehicles 2-5 Years Old Come with the choice of 2 Free Services or One Year Extension to The Audi Warranty when purchased using Audi Solutions excludes S, RS . R8 , W12 A8 Models
It is all discounting by another name.
Often, anything that is applied across all franchise dealer outlets is manufacturer led discounting. Other times there may be some element of local discount/incentives offered by the franchise itself.
I don't care what words they use to describe a discount, all I would do is look at the best price I can get. I usually go through brokers to get the best price, then haggle with a few local dealers and then compare it to the cost of leasing. If I can find a lease deal where the overall cost is less than the cost of depreciation when buying, then I'll go with a lease.
Most discounts applies to dealer finance schemes are also applied to leases too. So supported models that have good finance offers often also have some good lease deals knocking about.
If you do take the finance to get a discount you are within your rights to settle it after a few days and you'd keep the discount too.
Often, anything that is applied across all franchise dealer outlets is manufacturer led discounting. Other times there may be some element of local discount/incentives offered by the franchise itself.
I don't care what words they use to describe a discount, all I would do is look at the best price I can get. I usually go through brokers to get the best price, then haggle with a few local dealers and then compare it to the cost of leasing. If I can find a lease deal where the overall cost is less than the cost of depreciation when buying, then I'll go with a lease.
Most discounts applies to dealer finance schemes are also applied to leases too. So supported models that have good finance offers often also have some good lease deals knocking about.
If you do take the finance to get a discount you are within your rights to settle it after a few days and you'd keep the discount too.
You need to take account of the contribution in the full picture
If you get £2k contribution but the dealer wants 10.9% APR finance when you can have £0 contribution and 4.9% APR then you need to do the maths very carefully.
Or take the £2k and 10.9% and pay it off immediately (assuming you have the means to do so)
If you get £2k contribution but the dealer wants 10.9% APR finance when you can have £0 contribution and 4.9% APR then you need to do the maths very carefully.
Or take the £2k and 10.9% and pay it off immediately (assuming you have the means to do so)
Leicesterdave said:
The best finance I've had so far is 6.9% APR for HP finance. This over 4 years will cost me just over £2,000.
I'm wondering if I'm better off with the main dealer finance as even with a 10.9% APR, I get £1,000 off plus 2 free services or another year's warranty?
You need to do the mathsI'm wondering if I'm better off with the main dealer finance as even with a 10.9% APR, I get £1,000 off plus 2 free services or another year's warranty?
What is the total payable including interest at 6.9% with no contribution?
What is the total payable including interest at 10.9% less £1000 contribution?
- Straight discount off sticker
- Dealer contribution
- Manufacturer support
- Value of trade-in (+/- book)
- Different interest rates
- Sweeteners like servicing, fuel, even the old favourites of mats, gap insurance and "paint protection"
tty trade-in value.Edited by loudlashadjuster on Friday 10th March 10:45
APR high street loan 6.9% APR
Total cost of car: £17,500
- trade in (Skoda octavia) £2,500
- discount £500
Total need to borrow= £14,500
Total repayable over 3 years= £16,044 total cost for credit = £1544
Audi finance 10.9% APR
Total cost of car £17,500
- trade in £2,500
-discount £500
-£1000 deposit contribution
Plus 1 extra years warranty ( No idea on cost for this? Or two free services (Worth £400-£500 ish?)
£13,500 needing to be borrowed at 10.9% APR over 3 years= £15771 total repayable. Cost for credit : £2,271
Just about quids in for Audi finance? But do they offer these deals on PCP only- I'm after a straightforward HP as I may be doing high miles.
Total cost of car: £17,500
- trade in (Skoda octavia) £2,500
- discount £500
Total need to borrow= £14,500
Total repayable over 3 years= £16,044 total cost for credit = £1544
Audi finance 10.9% APR
Total cost of car £17,500
- trade in £2,500
-discount £500
-£1000 deposit contribution
Plus 1 extra years warranty ( No idea on cost for this? Or two free services (Worth £400-£500 ish?)
£13,500 needing to be borrowed at 10.9% APR over 3 years= £15771 total repayable. Cost for credit : £2,271
Just about quids in for Audi finance? But do they offer these deals on PCP only- I'm after a straightforward HP as I may be doing high miles.
Leicesterdave said:
APR high street loan 6.9% APR
Total cost of car: £17,500
- trade in (Skoda octavia) £2,500
- discount £500
Total need to borrow= £14,500
Total repayable over 3 years= £16,044 total cost for credit = £1544
Audi finance 10.9% APR
Total cost of car £17,500
- trade in £2,500
-discount £500
-£1000 deposit contribution
Plus 1 extra years warranty ( No idea on cost for this? Or two free services (Worth £400-£500 ish?)
£13,500 needing to be borrowed at 10.9% APR over 3 years= £15771 total repayable. Cost for credit : £2,271
Just about quids in for Audi finance? But do they offer these deals on PCP only- I'm after a straightforward HP as I may be doing high miles.
The deposit contribution is for generally only for PCP, they want to hook you in. Nothing to stop you settling early, you'll get a rebate of interest and could then fund it with a personal loan. Total cost of car: £17,500
- trade in (Skoda octavia) £2,500
- discount £500
Total need to borrow= £14,500
Total repayable over 3 years= £16,044 total cost for credit = £1544
Audi finance 10.9% APR
Total cost of car £17,500
- trade in £2,500
-discount £500
-£1000 deposit contribution
Plus 1 extra years warranty ( No idea on cost for this? Or two free services (Worth £400-£500 ish?)
£13,500 needing to be borrowed at 10.9% APR over 3 years= £15771 total repayable. Cost for credit : £2,271
Just about quids in for Audi finance? But do they offer these deals on PCP only- I'm after a straightforward HP as I may be doing high miles.
When Mrs PR bought her Hyundai I was amazed we only had to borrow £1500 @ 3% apr to qualify for £750, not worth bothering to settle early we just let it run.
spookly said:
...
If you do take the finance to get a discount you are within your rights to settle it after a few days and you'd keep the discount too.
I've ordered a new car via a finance deal ( didn't want to, but that was the only way I'd be sold it for the advertised price). I said to the salesman that I knew I could pay the finance off straight away and he said as long as it was done within 14 days I'd be within my rights. I'd have to pay a small amount of interest on the short time before I'd repaid the amount - which I thought was fair.If you do take the finance to get a discount you are within your rights to settle it after a few days and you'd keep the discount too.
He mentioned that I'd have to come into the dealership and sign the finance papers before the car arrives - will take a couple of weeks before car is delivered - so does the finance agreement start as soon as I sign the paperwork? or when the car is delivered?
condor said:
He mentioned that I'd have to come into the dealership and sign the finance papers before the car arrives - will take a couple of weeks before car is delivered - so does the finance agreement start as soon as I sign the paperwork? or when the car is delivered?
Strictly speaking the right to withdraw is for 14 days after signing the agreement. I went through this with VW recently and I was told VWFS were flexible on this and worked from the date of delivery, however I was anxious not to test that so only signed a couple of days before delivery and withdrew after I'd had the car a week.I wouldn't tell the salesman I was going to do it though. The deal may well be affected if they think you're not going to continue with the finance.
I thought that might be the case.
The salesman already knows as originally I was paying full amount by debit card. He couldn't get his computer to give me the local newspaper advertised amount...and after chatting to his boss, that's when it became obvious it was a finance deal.
I fully intend to pay off the finance deal straight away - though not sure how that is done. Perhaps via on-line banking?
Last time I bought a new car was over 10 years ago and even though I had the money in my current account and had told my bank I was buying a new car - the bank then caused problems with the debit card transaction. Took over 20 mins on the phone to get them to release the money - I don't want that happening to a finance company that is more than happy to not have the full payment.
The salesman already knows as originally I was paying full amount by debit card. He couldn't get his computer to give me the local newspaper advertised amount...and after chatting to his boss, that's when it became obvious it was a finance deal.
I fully intend to pay off the finance deal straight away - though not sure how that is done. Perhaps via on-line banking?
Last time I bought a new car was over 10 years ago and even though I had the money in my current account and had told my bank I was buying a new car - the bank then caused problems with the debit card transaction. Took over 20 mins on the phone to get them to release the money - I don't want that happening to a finance company that is more than happy to not have the full payment.
I'm a little concerned now. Have I already signed the finance agreement or ( as I think) the intention to order the car and take up their finance offer - with the finance agreement coming later that I need to sign? That's what I was told.
It's not clear from the paperwork I've got and I can easily see the 14 days withdrawal period being up - without the car being delivered to the dealership.
In the worst case scenario, if I have been strung along so as the 14 day cooling off period has passed, will I just have to pay a settlement fee and interest to date? although why I should pay interest on a loan when I've not even seen the car, let alone have driven it needs answering ( if that happens).
It's not clear from the paperwork I've got and I can easily see the 14 days withdrawal period being up - without the car being delivered to the dealership.
In the worst case scenario, if I have been strung along so as the 14 day cooling off period has passed, will I just have to pay a settlement fee and interest to date? although why I should pay interest on a loan when I've not even seen the car, let alone have driven it needs answering ( if that happens).
steve-5snwi said:
You would normally pay off the interest accrued, so if you let the agreement run full term then you would pay 48 months interest, if you pay it off in month 1 then you pay 1 months interest.
I forget the exact timescale (28 days comes into it somewhere) but effectively there's a maxium penalty of a month, plus you usually have to give a month notice so worst case you pay 2 months interest. At current interest rates it won't be very much. There also used to be document etc fees which could be a couple of hundred or so, which you didn't have to pay if Wiithdrawing but do if Settling, but these have largely been done away with now.
condor said:
I'm a little concerned now. Have I already signed the finance agreement or ( as I think) the intention to order the car and take up their finance offer - with the finance agreement coming later that I need to sign? That's what I was told.
It's not clear from the paperwork I've got and I can easily see the 14 days withdrawal period being up - without the car being delivered to the dealership.
In the worst case scenario, if I have been strung along so as the 14 day cooling off period has passed, will I just have to pay a settlement fee and interest to date? although why I should pay interest on a loan when I've not even seen the car, let alone have driven it needs answering ( if that happens).
If you'd signed the finance doc's you'd have all the T&CsIt's not clear from the paperwork I've got and I can easily see the 14 days withdrawal period being up - without the car being delivered to the dealership.
In the worst case scenario, if I have been strung along so as the 14 day cooling off period has passed, will I just have to pay a settlement fee and interest to date? although why I should pay interest on a loan when I've not even seen the car, let alone have driven it needs answering ( if that happens).
Be careful re the 14 day cooling off period, depends on the finance house. But if you withdraw from the deal, you are also withdrawing from the deposit contribution.
"Settling" and "cooling off" (effectively canceling with no penalties) are different things.
PositronicRay said:
If you'd signed the finance doc's you'd have all the T&Cs
Be careful re the 14 day cooling off period, depends on the finance house. But if you withdraw from the deal, you are also withdrawing from the deposit contribution.
"Settling" and "cooling off" (effectively canceling with no penalties) are different things.
Are you sure that's right? I think the finance agreement and contribution are not contractually linked?Be careful re the 14 day cooling off period, depends on the finance house. But if you withdraw from the deal, you are also withdrawing from the deposit contribution.
"Settling" and "cooling off" (effectively canceling with no penalties) are different things.
truck71 said:
PositronicRay said:
If you'd signed the finance doc's you'd have all the T&Cs
Be careful re the 14 day cooling off period, depends on the finance house. But if you withdraw from the deal, you are also withdrawing from the deposit contribution.
"Settling" and "cooling off" (effectively canceling with no penalties) are different things.
Are you sure that's right? I think the finance agreement and contribution are not contractually linked?Be careful re the 14 day cooling off period, depends on the finance house. But if you withdraw from the deal, you are also withdrawing from the deposit contribution.
"Settling" and "cooling off" (effectively canceling with no penalties) are different things.
When the deposit contribution comes from the finance house, "effectively" tear up the finance deal and the deposit contribution goes as well.
Always worth checking, settling the finance is a different kettle of fish.
ETA, if not contractually linked then why not sign up to the contribution without the finance?
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