Agility Coming to an End - What to Do?

[mbenz76]

Hi All

My E350 is 6 months away from being 3 years old, which means I need to start making decisions about what to do since the Agility Finance deal comes to an end.

The car was something like £52k (due to all the options I crammed it with) and the buy out GFV price is about £20k (from memory).

I have been very happy with the car and am not desperate to get rid at all. The problem is that I don't have £20k sat spare - I expected to have, but things change over 3 years.

So anyone who has been through this - your experience and suggestions would be welcome.

I don't want to simply hand back, or I have just had a very expensive rental car and would then have to find myself a new car.

I would at a push go for a new MB but as I understand it (correct me if I am wrong), I would need to pay the GFV and own the car first so I can part-ex it for a new one, which puts me back at problem one.

I would very much like to keep the car but would need to refinance the GFV.

Does MB Finance enter into any refinancing agreements (I heard rumour that they might)? I guess I would essentiall buy second hand car for £20k from them over a couple of years - that sort of thing?

Or might the MB dealer be able to buy me out and sell it me back on new finance?

I had a brief look at personal loans, but those who would acknowledge that my £700/month payment wouldn't exists after I 'bought' the car were more than a bit unhappy about loaning that sort of money for what they saw as a second hand car, so that avenue is pretty much closed.

Are there other options for obtaining finance against a car in these circumstances?

And finally, when is the time to ask the questions formally?

Any advice would be much appreciated.

Thank you

 

[SportsCoupeRich]

My dealer reckons when you have about 6 months to go you should go see them (MB Chelsea). As I understand it your options are to:

a) hand keys back
b) buy out right
c) if there is equity in the car on paper, this can be rolled over into a new car.

So c) if the GFV is 20k but the car is worth 25k, you could hand it back and use that 5k as the deposit for a new one....

Am sure someone more knowledgable than me will be along soon.

 

[Truffs]

If you went for a new car you wouldn't have to find the 20k to pay it off, you would simply get a current settlement figure see what the PX value is for the car and use any difference as deposit on the next car (if there is any equity)

 

[sinewave]

Getting a personal loan for 20K should not pose a problem if your credit rating is acceptable.

What you use it for is of no concern to them at all.

Another option is to add £20K to your mortgage on a no early repayment penalty 3 year deal?

 

[grober]

Good time to think about this as it gives you a little room for manoeuvre. Don't know if these agreements have to " run to term" or you can terminate early--- perhaps a dealer may look more favourably on taking back a car with 6 months manufacturers warranty left on it as a more saleable commodity if you wanted to move on to a new Mercedes?? Waiting to order till towards the end of Q3 might get you a better new deal also? Keeping a modern Mercedes V6 diesel beyond its warranty period should also be given careful consideration depending on mileage unless you wish to extend the warranty of course.

 

[Deleted member 37751]

If I was you, and there'd been no problems with the car in the three years, I'd get a £20k loan and buy the car from Mercedes.

At least then you will own the car and if something changes and you fall on hard times, you can sell the car and clear the debt or thereabouts.

 

[mbenz76]

Having just wrote a very long reply and had the app lose it I will keep this short

Thanks for the replies.

I certainly prefer to keep the car if possible and prefer MB or dealer financing if that were available. I have good (I think) credit but also have enough other debts to put the lending wary banks off me. I have a relationship with MB for finance ready so hope that stands for something.

I would indeed buy an extended warranty if keeping the car as I am a big believer in them!

Has anyone ever bought out GFV through MB Finance or MB Dealer direct?

Out of interest where is the best place to get a good valuation for part-ex so I know whether I am in equity or not?

 

[RichardM]

You can trade the car in at any time, they can look at their system for an up to date settlement figure.

One option you have if you purchase a new Mercedes is to extend your car until it is ready. They will only do this if you have a new one on order though.

To finance the £20K there are a number of options. Rather than just take out a personal loan you could arrange car finance through a broker which would be secured against the car.

I don't believe MB Finance will help you though fund the payment.

 

[mbenz76]

Just an update.

Spoke to MB Finance. As stated above, they only extend current finance if you have a new order placed.

Interestingly they also consider extending the current agreement if you are having financial difficulties. Apparently not having the £20k GFV doesn't count

They did advise however that the dealer would be able to do it for me. Essentially buy it off me and sell it me as a new agreement as if I were walking off the street and buying a second hand car. I doubt I would come out on top of that deal as they would want their cut but worth investigating. Also not sure whether they would want deposit etc. again or if there would be equity to cover it.

Going to hold off visiting dealer for a few weeks until new car rush for September has died down a bit. Not like I am in a desperate rush given I have 6 months to play with.

If anyone has any suggestions for alternative finance brokers or any experience of doing it through the dealer to share then would like to hear.

 

[RichardM]

I'm in a similar situation as mine is due back 17th November. I had the letter a while back and then a reminder yesterday.

I'd be quite happy to keep the car for now and would have loved to have just extended it 6 months or even 12. Interesting if a dealer could refinance although not so sure about the buying it off me bit and then reselling.

I was going to contact one of these people who have been recommended:

Prestige car finance & vehicle finance from Oracle Finance Ltd
Car Finance Broker for Lease, Hire & Personal Contract Purchase Deals prestigecarfinance.com

But will probably wait until nearer the time.

 

[mbenz76]

Going to have a discussion with the dealer towards the end of September so will post back what I find.

Hoping rather than a buy back and re-sell it is something a bit better and more seamless. We shall see. I am guessing they won't match the MB finance APR either unfortunately.

I would have thought though that the dealer would arrange the finance if you bought a second hand car off the forecourt through MB Finance so who know how it works.

 

[Rory]

The problem is that I don't have £20k sat spare - I expected to have, but things change over 3 years.

You're a perfect PCP customer. The industry loves people with no money.

I would at a push go for a new MB but as I understand it (correct me if I am wrong), I would need to pay the GFV and own the car first so I can part-ex it for a new one, which puts me back at problem one.

Just to clarify the point, you don't have to actually pay the GFV if you're p/xing the car, it's all taken care of by the dealer. That applies even if you bought another make. Very, very few people can lay their hands on £20K just like that.

Obviously I don't know the details of your situation, but it may well be that taking another PCP is your best option. That will have a minimal deposit and you could choose a car with much lower monthly payments than £700.

 

[NISFAN]

Hi

I am at a similar point to you. I bought a C220CDi in July 2010 through agility.

First the bad news.....your car will almost certainly be in negative equity, and by the list of extra's you bought, would say it will be in really bad neg eq, as the 'toys' don't really add up to much in a used car.

(I recently got a dealer to discount an E by nearly £6k, so lowish 30's for a brand new one like yours, gives you an idea of what is going on out there right now.)

So even if you bought it as a second hand car, you would in effect be paying over the odds for it, but at least it is a car you know and cherish.

Most sensible thing to do would be to hand it back. In fact you could possibly be in the position to hand it back now (read early termination clause in your contract). Finance has dropped since 2010 rates, so you could be better off buying a new car now on PCP. This is what I am doing, and for £700 a month you would be surprised at what you could buy.

Get your car valued, but make sure you are sitting down when you do so.

There is light at the end of the tunnel, see my thread....and PM me about monthly prices if you want.

http://www.mbclub.co.uk/forums/general-discussion/136480-decisions-decisions-what-new-car.html

 

[jaymanek]

The long and the short is you need to re finance the car.

Im sure MB dealer will do it as they earn good commission from selling car finance.
If not there are LOTS of companies out there doing car finance.

 

[NISFAN]

Thing is, you can get low APR deals on new cars.....dealers get discounted scheme's, which a high street lender won't come close to.

In effect it means you can sometimes borrow twice as much for the same money, so may as well sign up for a new contract, perhaps at a lower monthly rate, and make plans to save enough come contract end time to buy it outright.

 

[mbenz76]

An update.

Spoke to dealer and they said they can basically buy me out of my GFV and re-sell me the car using any method available for a standard used MB sale.

For my info I asked them to work out a basic quote for me.

My GFV is £20k but that is due end of Feb so when they worked it out for me this week it showed about £25k due to settle now.

Putting the car back onto another Agility-type deal over another 36 months i would get an APR of 6.9%.

I would put no money down and over 3 years would pay £500 per month (instead of £700) - not as low as I thought. And have another GFV of £12k at the end - quite high!

Now the figures are skewed because I still have about £5k of payments to make.

However, on the seriously negative side, because they are essentially selling me the car again, I have to pay VAT on it. So about £2k of VAT on a car I have already paid VAT on!!

On the plus side, the brig the car and and give it the full treatment as if it were any used car being prepared for sale. A years warranty, road tax, free MOT at 3 years (assuming I did the deal before then) and anything they would usually replace on a used car sorted (worn tyres for example). So that alone could be worth £2-£3k.

They did say I can put money down if I wish or pay lump sums whenever I fancy without penalty (some newish financial regulation) and that if I did my monthly payments would be recalculated.

As a guide he said for every £1k extra I put to it, that it would represent about £30/month off the payments.

I can put about £5k down and have about £5k more payments to make so I estimate (very roughly and probably incorrectly) that by Feb time, if I went down this route, that I would be paying about £250-350/month and have a new GFV of maybe £5-7k. Which does look a little more attractive.

Not happy at all about the VAT issue though!

So, after all that I am undecided! But happy that there is a quick and easy solution if I don't find an alternative, and MB will let me do it right up until February so no need to rush.

I did look at the option of new again, which for a like-for-like car but with about £3k less of options and about £9k dealer contribution/discount it comes in at only £50/month cheaper than I am paying now.

What really puts me off getting a new one (other than the fact that I really like the one I have and hae no real need/want to change it) is that the new models look almost identical. I like to think when buying a new car that I am getting something different. Yes, I could go for a different model, but the only other models I really like are the ML and GL which are a bit out of my budget.

There are pros and cons to each but needs a serious dose of consideration.

And just out of interest for anyone in a similar situation, they valued my car at almost £25k so no negatie equity (in fact a bit of positive right not). Can't see it losing £5k by Feb so will be in decent positive equity by then as well which should hopefully help the situation.

 

[mbenz76]

Deleted due to double posting

 

[Paul/]

However, on the seriously negative side, because they are essentially selling me the car again, I have to pay VAT on it. So about £2k of VAT on a car I have already paid VAT on!!

Thx for this info, interesting to understand this option.

Where does the £2k come from- is it on the basis of them having a margin of £10k?

 

[Mercy1]

I did look at the option of new again, which for a like-for-like car but with about £3k less of options and about £9k dealer contribution/discount it comes in at only £50/month cheaper than I am paying now.

What's wrong with that??

If you like the car, and another new model will cost you 50 quid a month less than the current one, then I would snatch their hands off (and at the end of it you will still have a three year old car with plenty of time to work out how to deal with the next GFV!). Change the colour inside and out to make it feel different!

Perhaps I'm missing something but I also don't see your problem with keeping your present one. If your credit is good, a £20,000 personal loan over three years to settle the GFV will cost you about £600 a month. (I don't understand the necessity of getting involved in buying it again from the dealer - once you settle the GFV, the car is yours???)

The big disadvantage with this is that you lose the comfort of a new car guarantee, there will be inevitable maintenance costs, and at the end of it you will have a six-year old car worth next to nothing in your next trade in deal...you will need a serious amount of cash to get back into new car territory!

Go new, I say...!

 

[Rory]

Thx for this info, interesting to understand this option.

Where does the £2k come from- is it on the basis of them having a margin of £10k?

I guess they must be bumping ut the value for the new PCP by £10K? To rebuy the car on another PCP just feels mad though. I don't know, maybe it does make sense?

I must admit I'm somewhat bemused by all those numbers - I suppose they look a bit high as we're basically talking about a £50K car.