PCP car finance, is optional payment included in credit amount?

[ehhwhat]

As title, im looking at a used car with example details below

Deposit £5,000
Monthly fee £500+
Term 36 months

OTR price £30,000
Total amount of credit £25,000
Optional final payment £15,000

Apr 10.9%

My question is, is the optional final payment of £15,000 included in the credit amount of £25,000? So if i wanted to get a bank loan at a better apr i would just need to finance £10k over the specific term? And then i choose what to do with car at the end of the term?

[malvolio]

No, it's outside the loan amount. All they do is take £15k (or whatever) out of the equation so you don't pay interest on it via a loan, hence the apparent savings. Your end-of-term options are give the car back (assuming you don't owe them money for exceeding the agreed total mileage), pay them £15k and keep the car, or trade it against a new deal using the £15k less the market value of the car (which may be less than £15k of course, meaning you also owe them something.)

PCP deals work if you keep using them as per the last option and hope the dealer gets their sums right. At some point you have to stop by paying off the final payment. Or better still, don't start in the first place.

[Project Monkey]

As title, im looking at a used car with example details below

Deposit £500
Monthly fee £50+
Term 36 months

OTR price £3000
Total amount of credit £2,500
Optional final payment £1,500

Apr 10.9%

My question is, is the optional final payment of £1,500 included in the credit amount of £2,500? So if i wanted to get a bank loan at a better apr i would just need to finance £1k over the specific term? And then i choose what to do with car at the end of the term?

FTFY - you were typing too many 0's

[Project Monkey]

Hang on a minute... you're a contractor aren't you? Why do you need to borrow £10k? If you're £10k short for a £30k car, then buy a £20k car.

[northernladuk]

As title, im looking at a used car with example details below

Deposit £5,000
Monthly fee £500+
Term 36 months

OTR price £30,000
Total amount of credit £25,000
Optional final payment £15,000

Apr 10.9%

My question is, is the optional final payment of £15,000 included in the credit amount of £25,000? So if i wanted to get a bank loan at a better apr i would just need to finance £10k over the specific term? And then i choose what to do with car at the end of the term?

Pretty crap example. They should be giving you total cost as well as those figures shouldn't they so the answer should be clear.

[ASB]

Q1. Yes it is.
Q2. No. You would then be comparing apples and pears.

That 15k final payment is related to the finance deal.

[Paddy]

As title, im looking at a used car with example details below

Deposit £5,000
Monthly fee £500+
Term 36 months

OTR price £30,000
Total amount of credit £25,000
Optional final payment £15,000

Apr 10.9%

My question is, is the optional final payment of £15,000 included in the credit amount of £25,000? So if i wanted to get a bank loan at a better apr i would just need to finance £10k over the specific term? And then i choose what to do with car at the end of the term?

So with insurance, tax and servicing on top it will cost you about £1.70 per mile and you won't even own it until you make a further payment of £15,000.

I have always paid cash for a car in the range I an afford.

Have you got a small willy?

[JRCT]

I have always paid cash for a car in the range I an afford.

Have you got a small willy?

Me too.... the first bit.

[ASB]

No, it's outside the loan amount. All they do is take £15k (or whatever) out of the equation so you don't pay interest on it via a loan, hence the apparent savings. Your end-of-term options are give the car back (assuming you don't owe them money for exceeding the agreed total mileage), pay them £15k and keep the car, or trade it against a new deal using the £15k less the market value of the car (which may be less than £15k of course, meaning you also owe them something.)

PCP deals work if you keep using them as per the last option and hope the dealer gets their sums right. At some point you have to stop by paying off the final payment. Or better still, don't start in the first place.

you pay interest on the 15k. Obviously.

[fullyautomatix]

What car is it ? Used car but the costs seem to be more than a brand new Jaguar.