PCP/Finance - The facts

[Littlepeahead]

Originally Posted by Wideboy

Nail on the head. There is so much wrong with societies attitudes towards goods these days. People now aspire to drive PCP Audi's and live in their new barratts "made from cheese" house,

It's a good job they are not really made from cheese or I'd never get a mortgage as they know I'd have eaten most of eat 6 months after purchase.

Originally Posted by Wideboy

Nail on the head. There is so much wrong with societies attitudes towards goods these days. People now aspire to drive PCP Audi's and live in their new barratts "made from cheese" house, then spend their life living out of paying monthly payments. All really for the sake that they care what people think when they look at them. That might get some people's backs up but it's true. No one NEEDS to buy a new car or bike they just want to, which is fine, but then when they loose their income it's the governments fault for not paying enough job seakers.

Buying something on a loan/credit card fair enough if you can afford it, as SP1 said if all goes t!ts up you actually own the vehicle with no loans/finance secured against it, if you can still keep it great but if not just flog it to cover the repayments or pay it off. Purchasing things on finance on the other hand i just don't see the appeal. You don't own it until the end, you're locked into owning it until the end, realistically not many people will buy it off you until the finance is cleared, if it's written off you loose **** loads of money... ect ect.

I think alot of people look at buying stuff on finance because it's easy. The credit checks are easily passable for a child, everything gets arranged around you and all you have to do is sign your name and you never get to see what you're paying over the odds for.

As i said in the other thread, maybe I'm just old fashioned but I like owning stuff 100% and I like to hand over my money when I buy it.

By and large, I agree with you but credit is, unfortunately the way of the world now. Nobody actually needs an iphone but millions of people are paying £500+ so that their kids can have one.
I do take exception to the "credit checks are easily passable for a child" - you clearly have no idea about the systems, reports and information that finance companies have access to, which is why we decline at least 30% of applicants (and even more get "termed"). In order to get finance you need to be registered on voters role for at least three years at the current address and also at previous addresses. You need to have established yourself as a good payer and have no adverse information at disclosed or undisclosed addresses (and we can find all linked addresses whether disclosed or not) - yes, big brother is watching!
Biggest issue with the credit card/personal loan is that even when people find that they can't afford the payments they still don't sell the goods to repay their loan. Also, the comment regarding "you're locked into owning it until the end", that is just wrong. If you want to pay off the outstanding amount you get most of the interest removed and can do this or a partial early settlement at any time during the agreement. As an indicator, taking all of our 36 month loans into account, only 25% are still live after 2 years. People just do whatever is convenient for them at the time.

Originally Posted by Wideboy

Nail on the head. There is so much wrong with societies attitudes towards goods these days. People now aspire to drive PCP Audi's and live in their new barratts "made from cheese" house, then spend their life living out of paying monthly payments. All really for the sake that they care what people think when they look at them. That might get some people's backs up but it's true. No one NEEDS to buy a new car or bike they just want to, which is fine, but then when they loose their income it's the governments fault for not paying enough job seakers.

Buying something on a loan/credit card fair enough if you can afford it, as SP1 said if all goes t!ts up you actually own the vehicle with no loans/finance secured against it, if you can still keep it great but if not just flog it to cover the repayments or pay it off. Purchasing things on finance on the other hand i just don't see the appeal. You don't own it until the end, you're locked into owning it until the end, realistically not many people will buy it off you until the finance is cleared, if it's written off you loose **** loads of money... ect ect.

I think alot of people look at buying stuff on finance because it's easy. The credit checks are easily passable for a child, everything gets arranged around you and all you have to do is sign your name and you never get to see what you're paying over the odds for.

As i said in the other thread, maybe I'm just old fashioned but I like owning stuff 100% and I like to hand over my money when I buy it.

Yes, Yes, Yes. I can understand companies doing this as breakdowns of their company cars can cost them a blokes labour at £30+ hour and customer problems but people don't need a new car every 3 years because the warranty has run out and it needs 2 new tyres.

[Wideboy]

Originally Posted by Ninthbike

By and large, I agree with you but credit is, unfortunately the way of the world now. Nobody actually needs an iphone but millions of people are paying £500+ so that their kids can have one.
I do take exception to the "credit checks are easily passable for a child" - you clearly have no idea about the systems, reports and information that finance companies have access to, which is why we decline at least 30% of applicants (and even more get "termed"). In order to get finance you need to be registered on voters role for at least three years at the current address and also at previous addresses. You need to have established yourself as a good payer and have no adverse information at disclosed or undisclosed addresses (and we can find all linked addresses whether disclosed or not) - yes, big brother is watching!
Biggest issue with the credit card/personal loan is that even when people find that they can't afford the payments they still don't sell the goods to repay their loan. Also, the comment regarding "you're locked into owning it until the end", that is just wrong. If you want to pay off the outstanding amount you get most of the interest removed and can do this or a partial early settlement at any time during the agreement. As an indicator, taking all of our 36 month loans into account, only 25% are still live after 2 years. People just do whatever is convenient for them at the time.

I know the basics for passing a credit check as i have a mortgage and i couldn't have been accepted for it unless I had some sort of credit at some point, But i don't necessarily think it's difficult to get credit or find a way round the checks. One of my friends car went pop and he went to a local popular vauxhall dealer and got accepted on a 6 grand finance deal on a zafira. All good and well, but this person had 2 maxed out credit cards, lived in his over draft, wasn't a home owner and had a number of other purchases on finance which he didn't pay on time all to the point where he had credit companies ringing him all over the place. There is no way on earth he should have been acceptable on finance for £60 quid let alone £6000. I can only think that him as his misses got the finance signed in one of their parents name. I remember watching the essex car dealer program on c4 not long ago where a woman was trying to by some over priced merc on finance, she had all sorts of out goings and bad credit so of coarse she was rejected..... then so was 2 of her friends when finally her sister just scraped the checks and took the agreement. Whilst I appreciate that the credit check system can't take into consideration the lengths some people will go to get something they can't afford I do think its fundamentally flawed in that sense. There should really be some sort of clause in the T&C's to stop people doing this.

In regards to the "locked in" thing, I understand that there usually isn't anything signed in to stop you "paying out" of the agreement, what i meant was that you are locked into owning the vehicle, most people would walk away from a sale if the vehicle came up as having outstanding finance. I know the buyer can pay the funds direct to the finance company but really how many buyers can be bothered with all that? chances are the seller with finance won't accept a lower price than someone without as they have a price to clear that, depending on how long the finance has been running, could be more than the bike is worth second hand. Most buyers will walk as they'd possibly get a better deal else where.

"There should really be some sort of clause in the T&C's to stop people doing this" - there is. This is known as an accommodation deal and, if discovered can result in the perpetrators being prosecuted for fraud. We also run overnight checks for any links between accepted and declined deals so that an acceptance can be withdrawn if, for instance the original customer gets their mum, dad, uncle, aunt etc to take the finance for them. If someone was stupid enough to take out a finance agreement for someone like your friend then they deserve all they get. The finance company would be coming to them for the money when payments are missed and when they say "the car was for my "........" they also risk being prosecuted.

Lenders now have a legal duty to ensure that they are lending responsibly and will shortly be confirming income and outgoings before lending as this will soon be required by the FCA. In addition, the "£99 deposit" deals will probably become a thing of the past to ensure that the customer has shown some financial commitment to the agreement and is far less likely to find themselves in a negative equity situation.

[JamesMio]

Real life example then.

I was looking at a new Tiger 800, £8199 from a dealer, free top box / heated grips / screen.
They offered me peanuts for my old bike in P/X (£1000), so I'd be looking at £7199 to swap.

£1739 down, plus £240 various credit fees. (£1979)

1 x £175 then 35 x £99 p/m (£3640) on PCP, plus a final payment of about £4315 at the end to own it.

Total: £9694 (less £1000 p/x), = £8694.

OR...

Find a spotless, well cared for, sub 9000 miler 3 year old one, ride it home for half that cost and keep the old bike.

Saved: £4500 (easy!!), and all I'd notice in reality between that and a new bike is the number plate says 11 and not 14.

[NTECUK]

If your going to put some proper milage on the Tiger. Your get stung at the end. They only allow about 3,000 miles p/a
So second hand is looking better.

Originally Posted by JamesMio

Real life example then.

I was looking at a new Tiger 800, £8199 from a dealer, free top box / heated grips / screen.
They offered me peanuts for my old bike in P/X (£1000), so I'd be looking at £7199 to swap.

£1739 down, plus £240 various credit fees. (£1979)

1 x £175 then 35 x £99 p/m (£3640) on PCP, plus a final payment of about £4315 at the end to own it.

Total: £9694 (less £1000 p/x), = £8694.

OR...

Find a spotless, well cared for, sub 9000 miler 3 year old one, and ride if home for half that and keep the old bike.

Saved: £4500 (easy!!), and all I'd notice in reality between that and a new bike is the number plate says 11 and not 14.

Ah yeah but it's shineysssssssss.

To OP, I think you are in the wrong place to try and convince people. This forum is for bikes which are converted to peoples tastes with suspension, cosmetic etc . . .mods. We aren't about going as fast as we can, it's more enjoying the ride as most of us don't have power ranger suits which would be the only reason I could see use for PCP.

[JamesMio]

Originally Posted by NTECUK

If your going to put some proper milage on the Tiger....

1000 miles in the first 7 days... I like this bike!

Originally Posted by JamesMio

Real life example then.

I was looking at a new Tiger 800, £8199 from a dealer, free top box / heated grips / screen. So no discount then??
They offered me peanuts for my old bike in P/X (£1000), so I'd be looking at £7199 to swap. Nothing stopping you from selling your own bike.

£1739 down, plus £240 various credit fees. (£1979) These are included in the payments below so you have over-estimated.

1 x £175 then 35 x £99 p/m (£3640) on PCP, plus a final payment of about £4315 at the end to own it. Or swap it for a new one, use the equity as deposit and carry on paying £99 per month.

Total: £9694 (less £1000 p/x), = £8694.

OR...

Find a spotless, well cared for, sub 9000 miler 3 year old one, ride it home for half that cost and keep the old bike.

Saved: £4500 (easy!!), and all I'd notice in reality between that and a new bike is the number plate says 11 and not 14.

...........unless something goes wrong with it and you end up asking forum members for clues on how to fix it! As I said before, if you took the new one you then get to do exactly what you've just done in 3 years time with a bike that you've had since day one (so you KNOW it has been cared for, not just suspect). Everyone has their own preferences and neither is right or wrong but people should be (and are) free to make their own choices.