Sounds like a good plan I hope it comes off for you, I am sure you'll be delighted with it. I tested the diesel and it is a very good engine but I just prefer petrol. As to the new 1.2 Turbo I wish that been available to order but it was not to be. Although I prefer to have a well tried and tested engine if this new one as good as Ford's 3 cylinder turbo it will be great.

 

Another quick question, a friend of mine told me today that if i get my car on peugeots pcp that even if i pay the final amount I will have to keep paying a lease every year is this true? I always thought that once you pay final payment the car is yours. Sorry if this is a stupid question but first time I will be doing PCP my previous car was on 0% HP.

 

It's true on leases a token payment is required to maintain the tax savings made by the seller on the lease.

 

So do you have to keep paying that for the entire time you have the vehicle? Also what would happen if you wanted to sell or do pcp with another dealer etc?

 

You be best to goggle it for all the details, i am not a expert in this field.

 

So do you have to keep paying that for the entire time you have the vehicle? Also what would happen if you wanted to sell or do pcp with another dealer etc?

I think you need to sit down with the dealer - I did post about this elsewhere on the forum but ostensibly the option where you never own the car is an opening lease - it is not a PCP in the traditional sense. Operating leases get tax benefits but the person taking the lease can never own the asset for this breaks to apply; it's how most company cars and lease cars are procured. Peugeot do offer a proper PCP but you pay more for this and have the chance to own the car as it is a form of financing lease which doesn't attract the tax breaks. The operation lease (passport I think bits called) is not designed for people who want to own the car. The examples in adverts and on the Peugeot site do make this clear but I fear people pay more attention to the colour and monthly payment rather than the 'value'...

 

Cheers frank, I will speak to them. I suppose if I am not intending to keep the car it does not matter. But I guess it does mean your stuck with that particular manufacturer.

Has anyone here done PCP before what happens at the end if you trade for the same car but new, do you have to put a big lump sum deposit down again?

 

Hi,

It really depends on the deals being offered at the time you change your car as to the amount but generally yes you do need to put a deposit down again to secure another deal of any sort. This could be a low deposit of £500 or so or alternatively, if you want to reduce the monthly payments, makea larger deposit. Most large dealers offer flexible deals now. Good luck.

 

Has anyone here done PCP before what happens at the end if you trade for the same car but new, do you have to put a big lump sum deposit down again?

I've never done one but can explain it as thus;



The Guaranteed Minimum Future Value (GMFV) is approximately 80% of the Glasses guide price for the car given the mileage/ spec you are looking at, so at the end of the term you have the following options, some of which are not described in the bumf;



1) Give the car back and walk away - nobody ever really does this as the dealer will mark down every dink, mark, scratch and mile over the agreed amount and hit you for it.



2) Buy the car for the GMFV and keep it.



3) Trade it against another from the same manufacturer - they will offer you the Glasses valuation so you have approximately 20% 'equity' in the car - so imaging the GMFV you agreed to was £4,800 they'd expect to be able to offer you £6,000 so that's £1,200 to put into the next car as the deposit - they are keen to do this as it creates a pipeline of revenue for the rest of your driving career and people I know who use PCP's like this; the fact you've been building that up and paying interest on it for three years doesn't seem to bother people. Also, in this case so long as all four wheels point in the same direction the dealer won't care much about the condition.



4) Trade it against another car from a different manufacturer - they will, in order to get your busienss, offer you the Glasses price pay off the finance (GMFV) and use the equity in the same way as described above; people don't always think of this as an option though.



5) Buy it and sell private - this is the best way to get money back and can pay real dividends; the GMFV is £4,800 but you could sell private for £2,000+ more, a bit of work but worth it.



What most people don't realise is the equity being built-up gives them a chunk towards the deposit; most people could find an extra £1,000 to get on the merry-go-around again but nearly £2,500 feels sharp.



Personally, I can't get my head around paying for something I'll never own which is why I've always done cash or a bank loan (based on circumstances at the time) but somebody cleverer than me once said 'own assets, lease liabilities' and cars are not assets but depreciating lumps of metal so fall into the latter catagory. My wife's cousin gets a new Audi before the service is due on each car (the last car he serviced was a 2005 '05 Passat 2.0TDI which he kept for three years...), he just budgets £450 per month and then does a deal every 12-18 months, the 'equity' he has in the car defines what car he moves into (currently he is in an A4), it doesn't bother him that he doesn't own it as he can drive a car that he otherwise couldn't afford but I'd hate to think of the money he's spent over the years, but then the depreciation I've wasted is fairly large too. I just prefer saving and paying cash.