BMW Forums : BimmerForums banner
21 - 28 of 28 Posts

·
Registered
Joined
·
387 Posts
Why own something that's falling in value? Sound financial wisdom has always suggested:
If it appreciates - buy it
If it depreciates - lease it

If you're capital rich and can simply buy a car for cash - no harm in doing so.
If you're income rich it may suit you better to pay for it monthly
At the end of a pcp deal if the car is worth more than the balloon - you can buy it , or sell it
If it's not - just hand it back and the lease company takes the hit.

Key to all of this is the interest rate - at the moment you can get 2.9% on a new vehicle - that's a good deal. I saw 12.6% on an approved used vehicle - not a good deal.
That's garbage. It's about total cost of ownership. Why do you think firms push PCP so much? Because they make lots of money out of it. Who do they make the money from? You.
 

·
Registered
Joined
·
93 Posts
When buying mine I was looking at 6 months old cars buying on PCP (as I had done with my previous car) but the prices were ridiculous. So I carried on looking and found a 3 year old one with 16000 miles. BMW wanted 10% APR at the time but I got a bank loan at 2.9%. I like that the car is mine as I like to modify it - something that you can’t if you lease. In March of this year the loan will be paid, no ballon payments and the car has only depreciated about £5K over 5 years as most of the money was lost over the first 3 years. I’m still loving the car and plan on keeping it for the foreseeable! No monthly payments at all - can’t wait 😁
 

·
Registered
Joined
·
7 Posts
Discussion Starter · #25 ·
I ended up getting a 3 year old 530d saloon at half the new price. Not a high spec admittedly but Simon at E Maps has taken it from 255 bhp to 325 bhp and whilst not super fast it's usefully rapid in the real world and for overtaking on the motorway, etc. Very pleased and it's doing great mpg.
 

·
Registered
Buying X5 currently 440i (prev 335, 525, 523)
Joined
·
12 Posts
That's garbage. It's about total cost of ownership. Why do you think firms push PCP so much? Because they make lots of money out of it. Who do they make the money from? You.
Yes you're right - they do make money on it of course. What most people don't factor in howerver is the cost of the depreciation. You pay £40K for something that falls in value to £30K and then £20K. If that loss is nothing to you then of course you should always buy outright. But this assumes you have "free" money - ie either you don't have to borrow it, or you couldn't invest it and get a return. If you factor in that 20K (or whatever) loss into your total cost of ownership and still come out shiny - then buying is the right thing for you...
 

·
Registered
Joined
·
387 Posts
Mines currently going up in value and I don't have any monthly payments to make. Servicing and maintenance OK, but I would have paid more on PCP than the car was worth new and have nothing to show for it at the end. I'm about 20K better off, not worse.
 
21 - 28 of 28 Posts
Top