PCP question
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Junior Member
Joined: Jun 2015
Posts: 18
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MErcedes C Class 220cdi AMG line
PCP question
Might be one for UK users only as I don't know if PCP in terms of finance exists elsewhere. I took my C class on a PCP deal in October 2014 on 24000 miles a year. I now do half that due to a change in work location. When I phoned MB finance they told me they adjust mileage up but not down!! This keeps my payments higher as the mileage contributes to depreciation. My question is do you think the best option is to stick with it, its on a 4 year deal with the guaranteed future value set at £10450, or trade in the deal and take a new agreement out on another car? There will, I guess, be a bit of capital in the car in two and a half years due to the lower mileage I will present
Member
Joined: Oct 2014
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From: London, UK
S205 C200 Sport
You've got a few of options:
Continue the PCP agreement As you say, you can continue the agreement and your car is likely to be worth more at the end due to lower mileage. To capitalise this gain, you'll need to buy the car off MB or use it as a PX on any future purchase/PCP (the buying dealer will likely settle finance directly). If you return the car to MB Finance after the 48 months is up, it'll be solely their gain.
Settle the finance early yourself. Ask MB Finance for a settlement figure. Pay it and the car is yours to do what you want. You could see if you'll get a good price on the second hand market. Have a look at sites like www.webuyanycar.com who will give you a guideline amount. As you've only had the car 18 months though, it's likely to still be worth less the payments to date due to depreciation (ie. MB will want more for the car than it's worth on the used market)
Go for a Voluntary Settlement. This is a right under the Consumer Credit Act. Creditors don't like to discuss it but effectively once you've paid off half the amount due, you can ask MB to take the car back. I previously enquired about this and they said it may affect my right to future finance applications with them. They also gave some spiel about how it would be noted on my credit file as 'settled early'. I think the latter is just to try and discourage punters from exercising this option.
Some good resources worth reading here:
http://www.thecarexpert.co.uk/settle-a-pcp-early/
http://www.thecarexpert.co.uk/car-fi...nation-pcp-hp/
Continue the PCP agreement As you say, you can continue the agreement and your car is likely to be worth more at the end due to lower mileage. To capitalise this gain, you'll need to buy the car off MB or use it as a PX on any future purchase/PCP (the buying dealer will likely settle finance directly). If you return the car to MB Finance after the 48 months is up, it'll be solely their gain.
Settle the finance early yourself. Ask MB Finance for a settlement figure. Pay it and the car is yours to do what you want. You could see if you'll get a good price on the second hand market. Have a look at sites like www.webuyanycar.com who will give you a guideline amount. As you've only had the car 18 months though, it's likely to still be worth less the payments to date due to depreciation (ie. MB will want more for the car than it's worth on the used market)
Go for a Voluntary Settlement. This is a right under the Consumer Credit Act. Creditors don't like to discuss it but effectively once you've paid off half the amount due, you can ask MB to take the car back. I previously enquired about this and they said it may affect my right to future finance applications with them. They also gave some spiel about how it would be noted on my credit file as 'settled early'. I think the latter is just to try and discourage punters from exercising this option.
Some good resources worth reading here:
http://www.thecarexpert.co.uk/settle-a-pcp-early/
http://www.thecarexpert.co.uk/car-fi...nation-pcp-hp/
Thread Starter
Junior Member
Joined: Jun 2015
Posts: 18
Likes: 1
MErcedes C Class 220cdi AMG line
Might be one for UK users only as I don't know if PCP in terms of finance exists elsewhere. I took my C class on a PCP deal in October 2014 on 24000 miles a year. I now do half that due to a change in work location. When I phoned MB finance they told me they adjust mileage up but not down!! This keeps my payments higher as the mileage contributes to depreciation. My question is do you think the best option is to stick with it, its on a 4 year deal with the guaranteed future value set at £10450, or trade in the deal and take a new agreement out on another car? There will, I guess, be a bit of capital in the car in two and a half years due to the lower mileage I will present
Thanks for the reply, I have a friend who finished an agreement mid term. They actually took their skoda to a Seat garage who settled the agreement and he got a new Seat under PCP. Might pop to a dealer to see what is what. Having said that I love the car and it has no rattles or issues. I also got a good deal as I got the dealer trying to get up their end of year numbers at the end of August 2014 so gains might be marginal.
