Off Topic My 500 has been cloned...

[306maxi]

As for predictable costs, even if i had to replace 2 sets of tyres and do a full fat service including a timing belt next year i would still be in front of anyone on pcp.......

PCP is predictable, predictably expensive!

 

[stu0710]

As for predictable costs, even if i had to replace 2 sets of tyres and do a full fat service including a timing belt next year i would still be in front of anyone on pcp.......

PCP is predictable, predictably expensive!

PCP needn't be expensive, how can buying a car on 0% PCP be more expensive than buying a car outright for cash when outlined as per my previous post!

You're confusing the whole issue with the new car-vs-older car debate which is a separate thing. Running a 3 year old car with no warranty against a brand new car with full warranty is a calculated risk which may or may not pay off. More often than not it probably does, but there are regularly posters on here who are experiencing major and costly repairs to their cars out of warranty. Trading in for a new car replaces the risk with a known monthly cost, but at a premium.

Also I don't see why you state in your previous post that HP is 'the way to go' as opposed to a PCP scheme? Using, as an example, a 500 Pop 1.2 over 3 years with £1K deposit, the headline rate for PCP is 4.8% or 8.3% for HP, with the car ending up costing nearly £250 more on the HP scheme. At the end of the PCP scheme you are no more forced to trade-in the car than if you had bought it outright for cash in the first place, you could just opt to keep it?

 

[306maxi]

Because most people end up buying another and another and another.....

 

[Super Uwe]

Would you get rid of your current sofa just because you could get another one on 0% and then get another in 3 years time whilst the sofa is still fine?

Well no, I don't suppose I would. But if I wanted a different sofa for whatever reason then I could get one - don't think I would be breaking any laws by doing so?

I won't add to stu0710's last post as I think that is pretty much all that needs to be said. A PCP agreement is IMO a really useful thing that leaves a number of options available both during and at the end of the term.

Appreciate you want to run your 500 into the ground before you think about getting rid, and that is fair enough. But others will like the idea of swapping every few years as it eliminates a fair amount of hassle. Financially, yes - it probably will work out cheaper over the longer term just keeping hold of the same car, but it is a matter of choice and to be honest I don't see the problem myself.

 

[stu0710]

Maybe it's the cars...........?

Just because it's your choice to buy outright doesn't mean that serial PCP schemes are not the right choice for others. There is no definitive right or wrong in this, just different choices!

Either way the HP option looks expensive compared to PCP. Is any body using it and what are the advantages?

 

[306maxi]

We bought ours on hp as we knew at the end of the term it was ours with no balloon payment

 

[stu0710]

We bought ours on hp as we knew at the end of the term it was ours with no balloon payment

With HP though, the reason that there is no balloon payment, is that you're effectively paying this along with the regular payments as they are much higher. If you use my previous example of the 1.2 Pop over 3 years, the monthly HP payments are £282 as opposed to the £144 on the PCP scheme. It's 'swings and roundabouts' but it always pays to take the option with the lowest overall cost IMHO, which is generally (in the case of Fiat) the PCP one, particularly if it's interest free.

 

[306maxi]

I didn't realize that we were effectively paying the balloon payment every month. Learn something new every day! /s

It possibly would have worked out cheaper on pcp, but with hp you know you don't need to be saving that money every month and worrying if you fall behind. It goes out automatically every month and that's that done.

We own our 500 now and aside from 60 quid or so for bits for a service and about 250 for winter tyres in a few months, it's not cost anything aside from running costs.

If it suits someone then great, but don't try to make our that it's the cheapest or most sensible thing for everyone

 

[Super Uwe]

I didn't realize that we were effectively paying the balloon payment every month. Learn something new every day! /s

It possibly would have worked out cheaper on pcp, but with hp you know you don't need to be saving that money every month and worrying if you fall behind. It goes out automatically every month and that's that done.

We own our 500 now and aside from 60 quid or so for bits for a service and about 250 for winter tyres in a few months, it's not cost anything aside from running costs.

If it suits someone then great, but don't try to make our that it's the cheapest or most sensible thing for everyone

Not being funny, but no-one has said it is the cheapest or most sensible thing for everyone.

However, the i-Deal example that stu0710 has given shows that it can be the most cost-effective way of financing a new car. Bizarrely it does seem to work out better in the long run than if you actually paid for it outright as you can make interest on the money that you aren't having to stump up now (or at least use the free cash to pay off more expensive borrowings). Maybe it shouldn't be that way, but that is a completely different debate!

I still like the product itself as it offers flexibility. And sure, there is a cost built into that, but it is not IMO a rip-off by any means.

 

[306maxi]

It's cheaper because in the long term it earns the dealer more money

 

[RobinPJ]

It's cheaper because in the long term it earns the dealer more money

Strictly it's cheaper because it earns Fiat more money - it is Fiat that offers the cheap finance because it helps shift volume without giving discounts which harm residuals and reputations.

The dealers benefit of course but that is incidental so far as the motivations behind cheap manufacturer backed finance are concerned.

 

[306maxi]

Fiat/Dealer same thing

Not really..... Fair point Robin