PCP Advice - RS3 Saloon

[dxl]

I’m looking for some advice on a PCP offer from a dealer and I’m struggling to work out if it’s a good deal. I’ve never done a PCP before and have always gone the PCH route.

It’s for a RS3 saloon with over 8k options so nicely specced. I was offered £5k deposit over 4 years @ £700pm on 5k mileage. Reason for the low deposit is I’ll look to change every 2 years (as I usually go the pch route and have become use to this!)

How does this sound given my plans to change every 2 years or so?

The dealer was also quite assuring that I’ll be in positive equitity around 2 years due to the type of car and the specs, is this a fair assumption? (I know there’s no guarantees for this, but they mentioned £5k+ equity possible in 2 years which I thought sounded high?).

Any advice on this will be very much appreciated.

 

[revilo]

The dealer was also quite assuring that I’ll be in positive equitity around 2 years due to the type of car and the specs, is this a fair assumption? (I know there’s no guarantees for this, but they mentioned £5k+ equity possible in 2 years which I thought sounded high?).

More of a personal view, but after a few PCPs with well spec'd cars, I'd never bank on equity in a PCP.. More likely on a longer term deal though.

I was offered £5k deposit over 4 years @ £700pm on 5k mileage.

Have you tried running your spec through Carwow? That's normally my starting point to check initial discounts/PCP rates

 

[Jassyo06]

If you can afford it buy it mate,you'll not be in £5000 equity in 2 years,what period of time is the PCP over?

 

[RichardT]

If you can afford it buy it mate,you'll not be in £5000 equity in 2 years,what period of time is the PCP over?

He said 4 years in the original question.
I’ve never done a PCP, but my understanding is that it would take longer than half the period to get into positive equity.

 

[dxl]

More of a personal view, but after a few PCPs with well spec'd cars, I'd never bank on equity in a PCP.. More likely on a longer term deal though.

Have you tried running your spec through Carwow? That's normally my starting point to check initial discounts/PCP rates

Thanks for the insight revilo, I did feel as though the positive equity was just the sales guy trying to get the deal going as it sounded a bit too good to be around that figure. It was actually through Carwow originally and the deal has since moved forward from this.

If you can afford it buy it mate,you'll not be in £5000 equity in 2 years,what period of time is the PCP over?

I did think of buying it by taking out a bank loan but I’ve since got cold feet from that. Yes, it is over 4 years

He said 4 years in the original question.
I’ve never done a PCP, but my understanding is that it would take longer than half the period to get into positive equity.

That means if I break even (which is a lot more likely) I’ll spend the best part of £22k in two years... I was really hoping I’d have some equity at this period to put towards a deposit on a new car, possibly the next gen rs3 as it’ll be 2021 by then!!

 

[dxl]

Any chance the mods can move this into the RS3 room, it would be good also to get the views from there?

 

[winrya]

You’ll likely be in positive equity at 2 years as long as you have no options. Basically an 8k optioned car and a zero optioned car will yield you the exact same part ex figure at 2 years with a dealer or we buy any car. Obviously your settlement figure will be much higher at 2 years on the optioned car

 

[Jcbmally]

I’m looking for some advice on a PCP offer from a dealer and I’m struggling to work out if it’s a good deal. I’ve never done a PCP before and have always gone the PCH route.

It’s for a RS3 saloon with over 8k options so nicely specced. I was offered £5k deposit over 4 years @ £700pm on 5k mileage. Reason for the low deposit is I’ll look to change every 2 years (as I usually go the pch route and have become use to this!)

How does this sound given my plans to change every 2 years or so?

The dealer was also quite assuring that I’ll be in positive equitity around 2 years due to the type of car and the specs, is this a fair assumption? (I know there’s no guarantees for this, but they mentioned £5k+ equity possible in 2 years which I thought sounded high?).

Any advice on this will be very much appreciated.

Currently you can buy a 2 year old RS3 Sportback for £35k, 1 year old RS saloon for £38k.
If yours is roughly £58k including interest, (I've assumed it is a new car deal) then I would say the dealer is pulling your leg mate.
But as @jassyo06 said if you can afford it then do it.

 

[dxl]

Currently you can buy a 2 year old RS3 Sportback for £35k, 1 year old RS saloon for £38k.
If yours is roughly £58k including interest, (I've assumed it is a new car deal) then I would say the dealer is pulling your leg mate.
But as @jassyo06 said if you can afford it then do it.

Yeah, I’ve been looking at auto trader quite a bit recently for saloons but the ones which have all the options I’m looking for are typically £47k and above. The new car I specced comes in at just over £51k inc. discounts

 

[dxl]

You’ll likely be in positive equity at 2 years as long as you have no options. Basically an 8k optioned car and a zero optioned car will yield you the exact same part ex figure at 2 years with a dealer or we buy any car. Obviously your settlement figure will be much higher at 2 years on the optioned car

So based on this, positive equity is only likely if you have a stock car and I’m unlikely to be in the positive due to the options I’ve specced?

 

[Jcbmally]

Yeah, I’ve been looking at auto trader quite a bit recently for saloons but the ones which have all the options I’m looking for are typically £47k and above. The new car I specced comes in at just over £51k inc. discounts

Your doing well getting a decent discount on the RS model mate and if you like it, you'll want to keep it longer than 2 years.
Remember the new WLTP regulations may affect this model in the future so it may be worth keeping.

 

[NevMan]

He said 4 years in the original question.
I’ve never done a PCP, but my understanding is that it would take longer than half the period to get into positive equity.

Definitely, especially as only £5k deposit. With nester £10k more of a possibility

 

[winrya]

So based on this, positive equity is only likely if you have a stock car and I’m unlikely to be in the positive due to the options I’ve specced?

Afraid so. Wife made the mistake with a tt. Had 5k of options and it’s spent it’s whole pcp 4k in negative equity. Waiting to vt it as it’s the only way we can get rid without paying the 4k shortfall without waiting right until the end. It’s been this way since we first priced up getting rid at 24 months. (Now 37 months). If we’d kept to just 1k of options it would have broken even at 24 months. If no options we’d have had 1k of equity.

 

[dxl]

Afraid so. Wife made the mistake with a tt. Had 5k of options and it’s spent it’s whole pcp 4k in negative equity. Waiting to vt it as it’s the only way we can get rid without paying the 4k shortfall without waiting right until the end. It’s been this way since we first priced up getting rid at 24 months. (Now 37 months). If we’d kept to just 1k of options it would have broken even at 24 months. If no options we’d have had 1k of equity.

That’s fair enough winrya, was it a TTRS by chance? The dealer did say RS models held their value much better hence the positive equity but now I doubt the optimistic equity amount they projected after two years following everyone’s feedback so far...

 

[S32B]

I’m looking for some advice on a PCP offer from a dealer and I’m struggling to work out if it’s a good deal. I’ve never done a PCP before and have always gone the PCH route.

It’s for a RS3 saloon with over 8k options so nicely specced. I was offered £5k deposit over 4 years @ £700pm on 5k mileage. Reason for the low deposit is I’ll look to change every 2 years (as I usually go the pch route and have become use to this!)

How does this sound given my plans to change every 2 years or so?

The dealer was also quite assuring that I’ll be in positive equitity around 2 years due to the type of car and the specs, is this a fair assumption? (I know there’s no guarantees for this, but they mentioned £5k+ equity possible in 2 years which I thought sounded high?).

Any advice on this will be very much appreciated.

What did he say the GFV would be? and ask him to put it in writing about the £5k equity in 2 years! Bet he wouldn't lol. You'd be lucky to get that after the full 4 years! The prices could bomb out after 18 month, my current cars GFV dropped between the order date and delivery date! I'm expecting to hand it back and walk away at the end of the term...that's how you have to see a PCP...don't bank on having ANY equity in it....if you do it's a bonus!

The only guarantee money wise would be to continue PCH, you know exactly where you are.

To give you an idea, I just looked and you can get around £1,000 off the price of a basic RS3 from the likes of coast2coast, so add that £1k to your £5k and using that £6,0000 deposit over 4 years @ 5,000 mile per year gets you:

 

[wab172uk]

I’m looking for some advice on a PCP offer from a dealer and I’m struggling to work out if it’s a good deal. I’ve never done a PCP before and have always gone the PCH route.

It’s for a RS3 saloon with over 8k options so nicely specced. I was offered £5k deposit over 4 years @ £700pm on 5k mileage. Reason for the low deposit is I’ll look to change every 2 years (as I usually go the pch route and have become use to this!)

How does this sound given my plans to change every 2 years or so?

The dealer was also quite assuring that I’ll be in positive equitity around 2 years due to the type of car and the specs, is this a fair assumption? (I know there’s no guarantees for this, but they mentioned £5k+ equity possible in 2 years which I thought sounded high?).

Any advice on this will be very much appreciated.

So your going to stump up £20,000 over 2 years to drive 10,000 just miles? And then probably just walk away? Wow.

Or over 4 years, £38,600 for 20,000 miles, and then just walk away? After the 4 years, you'll still owe over £30,000 if you wanted to buy it.

5000 miles a year is 911 (or similar) territory. Not a quick A3. Especially as it works out at only 96 miles per week.

I work from home, so my car just sits in the garage all week. Even a few weeks. Each to their own, but I couldn't justify paying £20,000 knowing I was paying that for it to sit in the garage all week.

But, if you can afford it, and it's a car you deem worth it, then good luck. As others have said though, there's no way you'll be £5000 in equity after 2 years.

 

[S32B]

So your going to stump up £20,000 over 2 years to drive 10,000 just miles? And then probably just walk away? Wow.

Or over 4 years, £38,600 for 20,000 miles, and then just walk away? After the 4 years, you'll still owe over £30,000 if you wanted to buy it.

5000 miles a year is 911 (or similar) territory. Not a quick A3. Especially as it works out at only 96 miles per week.

I work from home, so my car just sits in the garage all week. Even a few weeks. Each to their own, but I couldn't justify paying £20,000 knowing I was paying that for it to sit in the garage all week.

But, if you can afford it, and it's a car you deem worth it, then good luck. As others have said though, there's no way you'll be £5000 in equity after 2 years.

That got me looking lol ...my choice for less money:

 

[dxl]

What did he say the GFV would be? and ask him to put it in writing about the £5k equity in 2 years! Bet he wouldn't lol. You'd be lucky to get that after the full 4 years! The prices could bomb out after 18 month, my current cars GFV dropped between the order date and delivery date! I'm expecting to hand it back and walk away at the end of the term...that's how you have to see a PCP...don't bank on having ANY equity in it....if you do it's a bonus!

The only guarantee money wise would be to continue PCH, you know exactly where you are.

To give you an idea, I just looked and you can get around £1,000 off the price of a basic RS3 from the likes of coast2coast, so add that £1k to your £5k and using that £6,0000 deposit over 4 years @ 5,000 mile per year gets you:

View attachment 170282

I did feel that £5k equity was too good to be true but it was strange the dealer was so confident, mainly because it was an RS but I guess I’m just dreaming because I want it to be the case!

So your going to stump up £20,000 over 2 years to drive 10,000 just miles? And then probably just walk away? Wow.

Or over 4 years, £38,600 for 20,000 miles, and then just walk away? After the 4 years, you'll still owe over £30,000 if you wanted to buy it.

5000 miles a year is 911 (or similar) territory. Not a quick A3. Especially as it works out at only 96 miles per week.

I work from home, so my car just sits in the garage all week. Even a few weeks. Each to their own, but I couldn't justify paying £20,000 knowing I was paying that for it to sit in the garage all week.

But, if you can afford it, and it's a car you deem worth it, then good luck. As others have said though, there's no way you'll be £5000 in equity after 2 years.

As I understood it, you set the mileage to the lowest possible to purely lower the payments if you are going to change in around 2 years time as you don’t pay excess mileage handing the car back mid-term. My actual mileage will sit around 8k per year.

Still with everything said so far, negative equity is where it will head so I’m not sure it’s an option anymore...

 

[Adam14]

As others have said, £5k positive equity in 2 years is a pipe dream, I'd highly doubt that. Feel many dealers say this sort of thing just to push deals through, then make up excuses when the time comes as to why it hasn't happened. If it is a new car as well, surely you're going to be in for a long wait? Latter end of next year based on current orders

 

[Adam14]

That got me looking lol ...my choice for less money:

View attachment 170287

What website is that?

 

[TYb]

I did feel that £5k equity was too good to be true but it was strange the dealer was so confident, mainly because it was an RS but I guess I’m just dreaming because I want it to be the case!



As I understood it, you set the mileage to the lowest possible to purely lower the payments if you are going to change in around 2 years time as you don’t pay excess mileage handing the car back mid-term. My actual mileage will sit around 8k per year.

Still with everything said so far, negative equity is where it will head so I’m not sure it’s an option anymore...

That’s incorrect, the mileage will be pro rata, so if you drive 16k in 2 years, you’ll be charged for the additional 6 @ the excess mileage charge.

Assume it’s 11p per mile, that’s £660 additional charge.

This guys either trying to pull the wool over your eyes or you a bit blinded by the car.

 

[Phutters]

What website is that?

This one.

Copy a line from it into Google.

You've heard of Google? It's this kind of search engine thing that helps you find stuff...

.

 

[dxl]

That’s incorrect, the mileage will be pro rata, so if you drive 16k in 2 years, you’ll be charged for the additional 6 @ the excess mileage charge.

So even more smoke and mirrors from the dealer then. I was told no excess mileage cost would apply but it would obviously affect the value price of the vehicle after two years when it is valuated.

 

[TYb]

So even more smoke and mirrors from the dealer then. I was told no excess mileage cost would apply but it would obviously affect the value price of the vehicle after two years when it is valuated.

Hmm I might be wrong but I’ve always been told to get the mileage right, they will be more lenient if then swapping for another Audi but if you walk away they’ll look to recoup the loss of value.

You could always call another Audi dealer and see what they’ll do for you with same desposit, get prices on 5 and 8k miles.

 

[Adam14]

So even more smoke and mirrors from the dealer then. I was told no excess mileage cost would apply but it would obviously affect the value price of the vehicle after two years when it is valuated.

I was told it is a rolling contract and worked the same for my dad. He's on 30k miles a year as a driving instructor, and does around 35k miles a year, so his upgrades always come just into a new year. For example he's just got a new A1 his old one had around 98k miles on it and just rolled into its 4th year and they were fine as the allowance shot up to 120k miles and no excess was paid. Whether this is how it works or whether they just manipulated the numbers, I couldn't tell you.

 

[Ron240]

As I understood it, you set the mileage to the lowest possible to purely lower the payments if you are going to change in around 2 years time as you don’t pay excess mileage handing the car back mid-term. My actual mileage will sit around 8k per year.

My understanding is that if you hand the car back and walk away you will be charged the relevant excess mileage, but if trading in to start again with another PCP deal the car will be valued based on current market value for the mileage.
Either way you effectively pay extra for higher mileage.

 

[Adam14]

This one.

Copy a line from it into Google.

You've heard of Google? It's this kind of search engine thing that helps you find stuff...

.

Can't say I have, got a link for it? Thanks for the website

 

[Phutters]

Can't say I have, got a link for it?

Sheesh...

You're going to have to cut your own toast into soldiers, old fruit...

.

 

[Ormesome]

What happens if you decide to buy the car at the end? If you go over the allowed miles then the car will be worth less than the contract stated GFV so would we pay the GFV or would we pay the market rate?

 

[AlS3BE]

What happens if you decide to buy the car at the end? If you go over the allowed miles then the car will be worth less than the contract stated GFV so would we pay the GFV or would we pay the market rate?

On a pcp you will have to pay the excess mileage charges to hand the car back.
If you decide to keep it regardless of miles or condition you pay the GFV.
There’s not an option to hand it back and buying it back at market value if it’s lower.

 

[Ormesome]

On a pcp you will have to pay the excess mileage charges to hand the car back.
If you decide to keep it regardless of miles or condition you pay the GFV.
There’s not an option to hand it back and buying it back at market value if it’s lower.

Ok, so only way out of paying for extra miles is to buy it at the end!

 

[S32B]

I did feel that £5k equity was too good to be true but it was strange the dealer was so confident, mainly because it was an RS but I guess I’m just dreaming because I want it to be the case!



As I understood it, you set the mileage to the lowest possible to purely lower the payments if you are going to change in around 2 years time as you don’t pay excess mileage handing the car back mid-term. My actual mileage will sit around 8k per year.

Still with everything said so far, negative equity is where it will head so I’m not sure it’s an option anymore...

They told me the same when I had my S3, "You will be changing at 50% mark with equity in the car, as the S models hold their prices well". Yet 3 years into the 4 year pcp they were giving me a px quote of less than what I still owed on it! I sold it privately for more.

You can only hand the car back once you have paid 50% of the total amount payable, so if the car was £40k and the interest on the fiance was £4k = £44k total, you'd have to pay back £22k before you could hand the car back and walk away, your deposit of £5k would count towards that £22k though, so your payments would have to reach £17k as 17+5 = 22 NB* It's not when you are 50% way through the PCP!!!

What website is that?

https://www.selectcarleasing.co.uk/

 

[dxl]

They told me the same when I had my S3, "You will be changing at 50% mark with equity in the car, as the S models hold their prices well". Yet 3 years into the 4 year pcp they were giving me a px quote of less than what I still owed on it! I sold it privately for more.

You can only hand the car back once you have paid 50% of the total amount payable, so if the car was £40k and the interest on the fiance was £4k = £44k total, you'd have to pay back £22k before you could hand the car back and walk away, your deposit of £5k would count towards that £22k though, so your payments would have to reach £17k as 17+5 = 22 NB* It's not when you are 50% way through the PCP!!!




https://www.selectcarleasing.co.uk/

Good to your experiences with PCP as the situation with the dealer sounds very similar to mine.

I get what you’re saying about the 50% of the total amount payable but does this apply if say I wanted to change in 18 months for a different car from them and take out a new PCP? This is what I was led to believe was possible when I spoke with them, but I’m not sure what to believe now!

 

[Terminator x]

Hmm I might be wrong but I’ve always been told to get the mileage right, they will be more lenient if then swapping for another Audi but if you walk away they’ll look to recoup the loss of value.

You could always call another Audi dealer and see what they’ll do for you with same desposit, get prices on 5 and 8k miles.

Tbf you'd be mad to attempt a PX with Audi imho (they all valued my RS3 at £4k below private purchase price) so actual mileage perhaps irrelevant eg sell the car before / at pcp end date and bank the difference.

TX.

Sent from my BBB100-2 using Tapatalk

 

[TYb]

Tbf you'd be mad to attempt a PX with Audi imho (they all valued my RS3 at £4k below private purchase price) so actual mileage perhaps irrelevant eg sell the car before / at pcp end date and bank the difference.

TX.

Sent from my BBB100-2 using Tapatalk

Agree, I did it one and swapped early being impatient once, never again.

The current car is either being sold and finance settled or VR’d this time around. I’m moving away from PCP for the next car.

 

[TYb]

Good to your experiences with PCP as the situation with the dealer sounds very similar to mine.

I get what you’re saying about the 50% of the total amount payable but does this apply if say I wanted to change in 18 months for a different car from them and take out a new PCP? This is what I was led to believe was possible when I spoke with them, but I’m not sure what to believe now!

You can swap when ever you like but if you did it after 18 months it’s likely the loan amount will be greater than the value of the car, what they’ll do is bake the difference into your monthlies or get a big deposit from you, swapping early is a really bad idea, 9/10 times you’ll be paying more than you should do.

 

[S32B]

Good to your experiences with PCP as the situation with the dealer sounds very similar to mine.

I get what you’re saying about the 50% of the total amount payable but does this apply if say I wanted to change in 18 months for a different car from them and take out a new PCP? This is what I was led to believe was possible when I spoke with them, but I’m not sure what to believe now!

You can still switch to another deal with them before you've paid 50% back, but be prepared to lose a load of cash! The 50% only comes into full effect if you want to hand the car back and walk away with no other car from them.

 

[Bells]

8k options on a car is financial nightmare especially on a PCP even a RS, all they do is make the car easier to sell for dealers and they barely give you any extra money for them come trade in. I regret adding nearly 5k of options to my S3.

Best price I’ve seen a RS3 saloon at was £42k at Sytner Audi it was a 67 reg (Feb reg) and 5000 miles, was decently spec’d with SS Seats, B&O, Pan Roof and Sports Exhaust.

I just can’t see how £5k equity in 2 years would ever work.

 

[Bristle Hound]

The dealer was also quite assuring that I’ll be in positive equitity around 2 years due to the type of car and the specs, is this a fair assumption? (I know there’s no guarantees for this, but they mentioned £5k+ equity possible in 2 years which I thought sounded high?).

@dxl - The part of your post that concerns me most
Trust what a 'Car Sales Executive' says? Really ...

Any chance the mods can move this into the RS3 room, it would be good also to get the views from there?

As requested, with a slight thread title change

 

[Bristle Hound]

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Duplicated thread
Further discussion here please
https://www.audi-sport.net/xf/threads/rs3-saloon-pcp-advice.381641/