Paying a car PCP off within 14 days

BillandHelen

BillandHelen

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We are currently looking at buying a new Audi, there is minimal discount for paying cash, but at least a £5000 manufacturer contribution if taking on a PCP. If I exercise the “cooling down” period and repay the finance company within 14 days, does the dealer have any comeback on the contribution provided? Oh for the days when cash was king!!
 
i believe that if you exercise the 14 day cool off then the deal is cancelled completely. the total deal as you probably know is worked out on the full term monthly payment plus the final optional purchase fee.

several years ago i had a 4 year pcp with mercedes and decided after 3 years to call it a day. they recalculated the total cost based on a 3 year pcp and asked me for the difference. the clause was well hidden in the T&C's.
 
When I bought my car a couple of years ago, I took advantage of the PCP deals ie extended warranty and free services for a couple of years.

I paid it off within 2 weeks and kept the deals, although I did have to pay about £30 for something, I can’t remember what.
 
Janine said:
When I bought my car a couple of years ago, I took advantage of the PCP deals ie extended warranty and free services for a couple of years.

I paid it off within 2 weeks and kept the deals, although I did have to pay about £30 for something, I can’t remember what.
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Maybe in your case but that is nothing to do with the cooling off period. That is a timeframe to allow you to cancel the agreed deal.

The OP need to enquire about paying it off early and if there is any penalty as a result.
 
You need to read the small print of your contract, they’re all different.

I understand you can’t pay off a pcp, but you can pay off a finance deal, I.e. HP but the terms are in the contract, you have to read and understand them.

Some years ago we were looking to buy a car, and they wouldn’t offer any cash discount but there were sizeable discounts if a finance deal was taken ( they get big commissions). The salesmen said, on the qt, that many people would take out the loan, then pay it off in full within a month or so of getting the vehicle. He asked us, if we were intending to do that, to keep it running for a few months because after a certain period they dont claw back his commission!
We didn’t buy the car after all.

We’ve just bought a new car, used Carwow to get the lowest cash price then haggled with our local dealer to get the best price. We have a blue light card, last car was bought through that, but this time the deals were not so good.
I think it only works with certain brands, but they’re desperate to sell cars according to the press.
 
Few years ago I bought a new van from vw. I was paying cash the salesman said if I took out vw finance then there was discounted servicing for 3 years and it can be paid off at any time.
I would ask the sales person as 5k is more substantial than discounted servicing the sales person does not care as long as he has done his job.

Car salesmen sell both cars and financing
, but prioritize selling finance packages because they often generate higher commissions and profits than the vehicle sale itself. While the primary job is moving inventory, dealers actively push finance, insurance, and service packages to maximize profit margins on both new and used vehicles.
 
Its in the T and C's read carefully, I took out a finance deal rather than a PCP and got the same discount and paid it off the day I collected the vehicle, I think we ended up paying £3 for the privilege as that was the day's interest charge

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Bought lots of new cars for cash over the years.
When the salesmen asks how much deposit and what period i want finance their faces drop when i say No finace, one payment only.
They make a lot of money out of your finance agreements.
They don't give anything for nothing.
 
We understood on our new cars that PCP deals were far more fixed, but HP deals you could pay back early with no issues. One salesman actively encouraged us not to buy cash but to take an HP deal for the extra discounts he could give us. We were able to clear it in month 2 (had to allow first payment to go through). Salesman at dealer was happy, we were happy, finance company less so I assume.

As has been said, check the terms and see if swapping to a different version of the deal will be better for you long term.
 
With a PCP, the car is the property of the finance company, the dealer sells the car to them, you are merely the keeper, if you give them their money back, they can just keep the car. If you terminate early for whatever reason, you can generally buy the car from them as per terms and conditions in the contract, if you terminate in cooling of period the contract is ended and it will be up to them if that want to sell you the car.
 
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Janine said:
When I bought my car a couple of years ago, I took advantage of the PCP deals ie extended warranty and free services for a couple of years.

I paid it off within 2 weeks and kept the deals, although I did have to pay about £30 for something, I can’t remember what.
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Have had PCP’s for a few cars. Always cleared within a couple of weeks, and the only charge was for interest up to the point of cancellations. Dealers don’t like it though,,,
 
Fiddler said:
Have had PCP’s for a few cars. Always cleared within a couple of weeks, and the only charge was for interest up to the point of cancellations. Dealers don’t like it though,,,
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So how did you benifit from paying in full at purchase? Intersted.
 
bobnick said:
So how did you benifit from paying in full at purchase? Intersted.
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For a previous car (Audi) the benefit of taking finance (not PCP), rather than paying full in cash, was a deposit contribution of £2k and free servicing for 3yrs. Finance paid off the following month with small interest payment and no other penalties.

It all depends on offer and T&Cs but I suspect a lot of these 'fiddles' have been shut down.

For most recent purchase (MG), cash in full achieved 30% discount on RRP but finance wasn't even discussed.
 
Done this twice, take their loan/pcp arrangement, get all the benefits, usually a discount and service plan, plus some mats. Then let it run for three months, then pay off in full. Cost to me, a few quid, literally £10 or so.

I understand that keeps dealer happy as they have had all their rewards from finance company by then?

Ps this was on minimum loan amount only of £5k.
 
Locally around me here in Spain 🇪🇸 and online, you pay a far lower price on finance. Cash is usually a lot dearer and no discount?

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The last M5 I bought had a fantastic finance contribution which I took advantage of. I paid the first payment on the finance then invoked the early redemption which attracted a termination fee of c.£500 all done around a month from taking delivery and settled in full. Net results I was £8200 up on the deal…
 
BrochMike said:
For most recent purchase (MG), cash in full achieved 30% discount on RRP but finance wasn't even discussed.
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That deal was only available under the Affinity scheme you had to be a government employee, not being one they would only give me about 12%.
Found a 6 month old one as new on Motorpoint 40% less than new list.
 
Lenny HB said:
That deal was only available under the Affinity scheme you had to be a government employee
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Nope, I have never worked for government!
Found via car wow and local dealer price-matched (but it was for the outgoing MG5 model so there were discounts galore!)
 
Lenny HB said:
That deal was only available under the Affinity scheme you had to be a government employee, not being one they would only give me about 12%.
Found a 6 month old one as new on Motorpoint 40% less than new list.
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It depends on what's happening in the market at the time. Our local dealer was way more expensive than one 50 miles away they had around 50 pre registered mg4s to sell in a month and we paid£22 k for a brand new pre registered trophy. On a PCP it would have cost around£4k more.
On the ops question I'd be looking at autotrader at new cars the same as the one that he's looking at to see if there are any deals to be had.
 
The Wino said:
It depends on what's happening in the market at the time. Our local dealer was way more expensive than one 50 miles away they had around 50 pre registered mg4s to sell in a month and we paid£22 k for a brand new pre registered trophy. On a PCP it would have cost around£4k more.
On the ops question I'd be looking at autotrader at new cars the same as the one that he's looking at to see if there are any deals to be had.
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Ours is an MG4 Trophy, I phoned several dealers none would do a decent deal but pleased with the 6 month old one we bought, not a mark on it and only 1700 miles.
 
I suppose what deals i missed out on here in the UK because i couldn't be arsed i made up on all the new cars i bought in Dubai which over a period of 35 years or so would add up massively.

The new car we just bought picking it up tomorrow, inshallah, we got nowt off. I did negotiate the ceramic coating down from £400 (daft price anyway) down to £100, in the end i said stick it don't want it.
So full asking price, one payment.
 
Our last two cars plus our daughters car have been PCP because of the extra discounts or service plan, we paid them off within 2 hours of collecting car as you pay interest daily. This hasn’t effected any of the extras that were included, I did mention to one of the salesmen that I’d be doing this and he tried to tell me it wasn’t allowed, I called the manufacturer and they confirmed it was fine and ok to do, I think the garage obviously get a bonus from the finance company if finance is taken out.

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Done exactly this on last car -> Not with AUdi, but Kia offered 3 years free servicing, and one of those services was a £500 one a a major. Total value of that, and the 0% finance, ie, me making money on the deal for the 3 year 0% term, then paying off in full meant a discount off the car of several thousand in effect.

(If you are not paying interest, and instead earning or stock marketing, you can get 4% (interest) or about 8% (stocks) -> which on a car is £800 for every £10k of the deal). All in (as the car was expensive it was considerably worth my time taking the PCP on 0% for (3) years). (liekly around a £8k discount in actual money terms).
 
bobnick said:
Bought lots of new cars for cash over the years.
When the salesmen asks how much deposit and what period i want finance their faces drop when i say No finace, one payment only.
They make a lot of money out of your finance agreements.
They don't give anything for nothing
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Yes us too but we were told by the dealer recently that there are loads of new cars on the road but not many with £250k cash in the bank to pay for their brand new Bentley Continental GT (I wish) or whatever brand it was. We live in a 'want it and want it now time'
 
Think they rely on percentages.
A very large percent of people taking a PCP or the other one will NOT pay it off after a week or month or 2..

I always said to myself a long long time ago that if i got into a position whereas i didn'r need finance i simply wouldn't have it, so i haven't. Everything we have now has been bought cash one time payment, including all the propertys.
 
Janine said:
The dealer talked me through the process of cancelling the PCP early and gave me the phone number to ring so I guess they get the commission regardless of when it’s repaid 🤷‍♀️
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They will get their commission for selling the car, however if finance is cancelled before the 14 days of doubt they’ll get commission on that, if you pay it off after the 14 days you’ll have to pay a exit fee I’d assume.
 
bobnick said:
I suppose what deals i missed out on here in the UK because i couldn't be arsed i made up on all the new cars i bought in Dubai which over a period of 35 years or so would add up massively.
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Out of interest would or could you have shipped those cars back to the UK and done any good out of it??
 

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