Does everyone just buy their cars with credit or...

[LewisStuart]

I normally just pay in twentys, its fun watching the seller count it.

 

[fanny]

And this has what to do with me pointing out people are mistaken in thinking they dont suffer from depreciation with a PCP

nothing what so ever, it is just a point

 

[Django x2]

Yep, most will be company cars. It's not until you spot the larger diesel engines (although even then can be company car), larger petrol engines or sports cars, and then, in a fair number of cases, some will be financed through some means.

Even the entry guys in my company get a crappy MK6 Golf

 

[[TW]Fox]

nothing what so ever, it is just a point

Well thanks for pointing out that when you PCP a car you get to drive a car. Now nobody will be in any doubt

 

[Bear]

I bought my Nissan when it was 3 years old on credit 8 years ago but bought my 3 year old Jaguar by cash, no credit.

It not cars that baffle me though, its houses bought about as we are looking to up size. The amount of £500k+ houses is mind boggling yet how many people earn £150k+ a year. Yes a lot of it can be attributed to price inflation but still, I guess thats why its called climbing the housing ladder.

 

[Randomface74]

I couldn't justify spending 30k on a car under any circumstances. There are tons of perfectly adequate cars for under 20k.

I buy cars outright, but never spent more than 10k, a car just doesn't matter that much to me.

I'm struggling to get a house though, prices are more than 5x my income, it's a nightmare.

 

[mattx2]

There is nothing wrong with credit if it's used sensibly. I paid cash for almost all of my cars, even my new Porsches but right now I can get a loan at 1.9% and put the money I would have spent into a CD earning 7%. It makes far more sense to net 5% on my money than to put 100% down on a car and lose the interest from it.

What bank pays out 7% for a CD?

 

[Django x2]

American ones

 

[wingman]

Because the rate is subdised by the profit on the car. It's usually in lieu of a discount you'd otherwise have been able to acheive.

In most situations, the only winner however you buy is the dealer and manufacturer. Which is fairly obvious really given they set the rules.

Otherwise been able to achieve where?

you do get a car though

Exactly. A simple yet incredibly important point. This has nothing to do with winning or losing, as there is no gamble whatsoever.

No you don't, you get the use of a car. But I'm not sure what your point is.

His point was that you are stating that the buyer on a technicality basis "loses". When buying a new car, the dealership has to stick rigidly to the manufactures price guidelines. It's true they can charge whatever they like on used, but with new cars there's very little profit in it for the dealership whatsoever.

From a buyers perspective, he is getting a low rate of finance with rock bottom interest rates and a new car (which typically comes with 3, if not 5 or 7 years warranty on all parts depending on manufacture), and a guarantee that if it breaks down or explodes they will get a new or like for like vehicle.

The alternative is getting a bank loan at an eye watering interest rate, then purchasing a second hand car with no warranty and no guarantee having God knows whom driven it.

 

[[TW]Fox]

Otherwise been able to achieve where?

Haggling with the dealer or buying through a broker.

His point was that you are stating that the buyer on a technicality basis "loses". When buying a new car, the dealership has to stick rigidly to the manufactures price guidelines.

This is not true. Depending on the brand in question there can often be SIGNIFICANT discounts on list price available on new cars!

The alternative is getting a bank loan at an eye watering interest rate, then purchasing a second hand car with no warranty and no guarantee having God knows whom driven it.

How you've managed to read that into my opinion that people who think you beat depreciation with a PCP are wrong, I've no idea.

You make it sound like the only choice is either a PCP on a new car or a bank loan on a no-warranty clunker. Bizarre, nobody has said that.

The point here is that a PCP is not some sort of uber canny way to beat the car market and win. It's just another way of buying a car, often the most expensive way infact.

 

[[ui]ICEMAN]

What bank pays out 7% for a CD?

My investor gets that with Citibank right now. They don't advertise such rates though.

 

[OllyM]

The alternative is getting a bank loan at an eye watering interest rate, then purchasing a second hand car with no warranty and no guarantee having God knows whom driven it.

I wouldn't call 6.1% eye watering?

 

[radderfire]

I'm struggling to get a house though, prices are more than 5x my income, it's a nightmare.

Me too. As anyone who follows economics will know, UK house prices have been unrealistically inflated by the credit boom, and the house price crash that should have happened didn't, because the Government decided to bail out RBS and the like instead. The financial sector has been given an artificial lifeline counter to the principles of a capitalist society, and whether we like it or not, you and I have to pay for it.

Rgds