Advise needed buying my first Merc

[jubbah100]

Hello guys just need a advise really so came here to ask.

I am looking at a 2018 e class amg line coupe low mileage petrol and from approved merc dealer on pcp deal for 3 years im thinking of putting 10 k deposit which would bring the monthly to £230 is this a good deal i know you can't tell me exactly but with the amount of deposit im putting down could i get better new car with similar monthly payments any help would be appreciated.

 

[liamt]

Importantly, what is the Apr? I imagine it is around 11%? Personally I wouldn't be putting 10k deposit in on a PCP deal. Whilst the monthly payments are lower, the balloon at the end will be much higher and there is a high chance you will be in negative equity.Given the current interest rates dealers are offering and the price of used cars, I'd say you'd almost certainly be in negative equity. How long do you plan on keeping the car for?

 

[Riva811]

I would keep the 10k for something else. These cars are money pits (depreciation a+ repairs)

 

[jubbah100]

Importantly, what is the Apr? I imagine it is around 11%? Personally I wouldn't be putting 10k deposit in on a PCP deal. Whilst the monthly payments are lower, the balloon at the end will be much higher and there is a high chance you will be in negative equity.Given the current interest rates dealers are offering and the price of used cars, I'd say you'd almost certainly be in negative equity. How long do you plan on keeping the car for?

yes around 11 % i plan to keep it 3 years and give it back

 

[jubbah100]

I would keep the 10k for something else. These cars are money pits (depreciation a+ repairs)

so guessing its not a good move

 

[liamt]

so guessing its not a good move

Not at 11% with that deposit, you will probably be in negative equity at the end and will lose that deposit unless you pay the balloon off and keep the car.

 

[jubbah100]

Not at 11% with that deposit, you will probably be in negative equity at the end and will lose that deposit unless you pay the balloon off and keep the car.

so its better off keeping the car final payment is around 11 k

 

[jubbah100]

Not at 11% with that deposit, you will probably be in negative equity at the end and will lose that deposit unless you pay the balloon off and keep the car.

you advise to shop round whats my chances of getting a better deal with the same ?

 

[ChrisEdu]

I think there a reasonable number of us here that would suggest take your 10k, save a bit more, not much more needed, and buy a good example of something a bit older, circa 2012-14. Still able to get something very nice, but minus some of the issues unique to the more modern cars.

 

[Tonygw]

PCP deals where good in the glory days of the base interest rate being 0.25%

Now, the interest is crippling so you will be in negative equity by the end to the term. A lot of PCP deals have a lot of small print regarding maximum mileage allowance and condition when the car is returned. So many people have been stung that way without reading the terms and conditions.

Personally I prefer to spend my money on things rather than interest payments etc..

As mentioned save your £10K and buy a car based on your budget and not on what you can afford every month with the end goal of not actually owning the car you have been paying for.

 

[ALFAitalia]

Importantly, what is the Apr? I imagine it is around 11%? Personally I wouldn't be putting 10k deposit in on a PCP deal. Whilst the monthly payments are lower, the balloon at the end will be much higher and there is a high chance you will be in negative equity.Given the current interest rates dealers are offering and the price of used cars, I'd say you'd almost certainly be in negative equity. How long do you plan on keeping the car for?

Why would the balloon be higher with a bigger deposit?.....its up to him what the final payment is....if he wants a smaller one he can ask for it. I have customers asking for next to no balloon payment for what ever reason.....never a problem for me to let them have it.

 

[liamt]

Why would the balloon be higher with a bigger deposit?.....its up to him what the final payment is....if he wants a smaller one he can ask for it. I have customers asking for next to no balloon payment for what ever reason.....never a problem for me to let them have it.

The key information missing from the op is the cash price and the total amount borrowed. However, a larger deposit reduces the monthly payments but the balloon at the end of the agreement is higher as he is paying off less of the amount borrowed on a monthly basis . A smaller deposit at the beginning would increase the monthly payments, but reduce the balloon at the end (he is paying more of borrowed amount off monthly).

It is rather easy to fall into the trap of putting in a larger deposit in to get the monthly payments down but it will sting you at the end as you will be in negative equity. The vehicle value will more than likely be less than the balloon (negative equity). There would be no money to put towards another car if you were trading it in for another and you would have to start again.

So yes, he can dictate what the balloon payment is at the end but only by increasing or decreasing the deposit at the beginning.

 

[ALFAitalia]

Not true.....as long as he does not exceed the maximum allowed final payment (which is a set amount decreed by agreement length and mileage) he can set the final payment and deposit to what he wants.