I Can’t Afford My PCP Payments – Can I Cancel My Contract?
If you bought your car on PCP but your finances have gone awry, a Voluntary Termination might be an option worth considering. Read our post to find out what you can do and what it might cost to terminate the agreement.
How to get a great deal on car finance
Interest rates have never been lower, but despite the affordability of borrowing money, some lenders still charge extortionate fees. They know that some consumers won’t put in the time and effort to look around, which is why they can get away with it. So while you can take out finance very cheaply to buy that car you’ve been promising yourself, you could also end up paying way over the odds if you don’t do your homework first. The golden rule – as ever – is to shop around and to haggle hard. It’s only by doing these things that you’ll know you’re getting the best possible deal. To put things into perspective, take a look at the MoneySuperMarket.com loan calculator, which enables you to see exactly how much that loan you’re considering will cost you. Let’s assume that you want to borrow £8000 to buy a tidy used Ford Fiesta. It’s worth £10,000 and your current transport, an ageing Vauxhall Corsa, is worth £2000 as a trade-in. On the high street you can currently take out a loan with an APR of around 3.5% – yet some car dealers have APRs of more than 10% on their loans. Put these figures into the loan calculator and you’ll see that if you borrow £8000 over four years (48 months) at an APR of 3.5%, you’ll have to find £178.65 each month. By the end of the term you’ll have paid £575.33 in interest charges, making the total amount payable £8575.33, which is pretty palatable.