Rocket - Unfair Pricing?

PCP on the Africa twin I had was 0% interest rate so a real no brainier. From memory it was £139 pm including my £1k deposit.
Cheap motorcycling. Sold it in the end but my intention was to just hand it back at end of contract.

 

Agreed @littleade I did the same for the last couple of cars, and again last month when I bought my latest car. Mazda over £2k contribution/discount and a further just short of a £1k from the dealer. PCP is with Santander which I will pay of in June this year saving on the interest over the full term of the agreement. Added to a great trade in price for my car this was by far the cheapest way to purchase the car.

 

PCP makes as much sense as any other kind of financing really. I mean think about it, Why would you lumber yourself with a mortgage that you don't repay for 30 years, and ends up costing you many mulitples of the original amount in interest? It's so that you can buy a house that you otherwise couldn't afford to.

I mean, is there really EVER a legitimate use for a loan, other than wanting something you haven't yet saved up for?

I actually quite like PCP as it goes, especially if 0% as there's literally no down side. If at the end of the term your bike is worth way more than the balloon payment, great, pay it off, sell the bike, and take the equity. If it's worse less, also great, just hand it back to the finance company, and let THEM stomach the burden of having under-egged the depreciation, and know that you're actually better off than someone who bought it outright.

I also like PCP insofar as it illustrates the true cost of owning a vehicle, which is often lost on people that buy it outright. Many people will save up for, and buy a nice £30k car, only realising after 5 years when they come to sell it, that's it's only worth £6k on the open market, and therefore they've been losing over £400 a month on depreciation without even realising it.

To illustrate that last point, I was looking at a spec'd out Ford Edge on PCP, and a Porche Macan both close to £40k (the Ford slightly cheaper), but the Porsche actually had cheaper monthly PCP payments, because the final value was so much better than the Ford! Most people looking at a Ford, wouldn't assume that they could possible afford a similar (but better) Porsche, when infact it can be cheaper.

 

Thanks, my example was actually from about 18 months ago, I have a 'new' car already. Hope you enjoy the Edge!