Alternative to MB Finance PCP

[Robfen100]

Hi all,

Has anyone tried comparing a PCP on MB finance with another finance provider to influence the deal? I'm talking PCP specifically which appears to reduce it to very few options. A quick Google search:

• Capital Car Finance
• The Car Finance Company
• Zuto
• and such other creative / dubious names!

The above acting as brokers presumably.

Black Horse Motor Finance (Lloyds) also appears but I don't think available direct for individuals, i.e. only dealers?

I wonder if these other finance companies will better the main dealer APR rates, or are they there for buyers whom can't easily obtain finance (if you know what I mean)

We all know there are new car incentives and offers linked to MB finance one would presumably loose if effectively buying cash (arranging finance somewhere else)

Cheers, Rob

 

[Robfen100]

Just found 'Oracle Finance'

Appears professional, anyone know them?

I don't want to start getting quotes prematurely as will result in more junk email etc

 

[Primo]

Try Arval.

 

[chardonbleu]

Black Horse Motor Finance (Lloyds) also appears but I don't think available direct for individuals, i.e. only dealers?

Halifax (Lloyds) are now offering PCP on new and used cars through their online banking. Looks like you need to have been a current account customer for at least three months though to build up a credit profile, they appear to make a credit decision based on that rather than an external credit check.

They're advertising 3.6% typical APR, for info they have quoted me for a PCP on a new GLC at 3.2% APR. The monthly payments are similar to a MB finance quote I received, the balloon payment is much lower though.

Let me know if you find anywhere cheaper!

 

[Robfen100]

Spooky!

I'm on the brink of talking to a dealer for a new GLC too!

Have you struck a deal yet?

 

[Robfen100]

Just read your post again, GFV lower I see.

So their valuation of the car in (3 years?) is lower, which makes buying it outright a more attractive proposition.

The dealer likes a higher GFV in order to aid switching to a fresh PCP as it is more likely to have a bit of equity? Or is it if the GFV is higher then we're financing less which lowers repayments a bit?

What was the difference between GFV's you were quoted please?

 

[chardonbleu]

The sums will be different for everyone of course but just for information (definitely not advice ), in these quotes I obtained it's for a GLC 350d Sport (with just metallic paint in the MB quote, premium plus pack added in the LBG one which if anything should raise the GFV, with slightly different deposits the amount financed is very similar, £186 more in the MB quote).

Also depends on the term, but for example after 48 months the MB Agility GFV was £21,250 and LBG was £16,118. Monthly payments pretty much the same (£582 v £584).

If you were to buy at end of term total amount payable c. £49,190 (MB) vs £43,570 (LBG).

Seems to me that unless you are definitely just going to hand it back at the end of 48 months (or the actual value is below the GFV) then that's either a good chunk more equity to put towards your next car/realise by selling, or a cheaper way to buy.

Whilst the monthly payments are the same, the lower interest rate means a lower GFV (final payment would be a more logical thing to call it I think - the name GFV makes it sound like it's a good thing being higher - which it could be if interest rate is the same and you're trying to lower monthly payments, but otherwise it is not).

I suppose another MB dealer might give a keener quote, and LBG (or whoever) might offer someone else a higher rate, so this is unlikely to be the same for everyone. Also, as it's a new model it seemed there were no discounts or dealer contributions on the table - if they are it sounds from other threads on this board like it might be worth taking MB finance to maximise those. In the circs though I've ordered the car with no dealer finance!

I hope that's helpful. Let me know how you get on!

 

[Little Lofty]

I got quotes from the Halifax when I bought my C63. The interest rate was 3.2% APR compared to MB 9.9%. Unfortunately the dealer I bought from wasn't on the list of approved dealers that Halifax operate with so it was a no go ( not sure why as it was MB dealer) I looked at Oracle, but tbh there wasn't much in it as I had managed to get MB down to 7.9%, plus I got a deposit contribution of £750. Over the 4 year term the Halifax would have saved me a good couple of grand in interest, I'll only keep it a year or 18 month so I wasn't too bothered. I'll definitely use the Halifax in the future as there rates are excellent. The have an online tool for their internet banking customers and you can play around with deposits, terms etc once you know the reg of the car your looking at.

 

[chardonbleu]

Unfortunately the dealer I bought from wasn't on the list of approved dealers that Halifax operate with so it was a no go ( not sure why as it was MB dealer)

That's unlucky - I tried inputting two different MB dealers and they were both approved.

you can play around with deposits, terms etc once you know the reg of the car your looking at.

If its a new car you don't need to know the reg to try out different specs, deposits, terms etc.

 

[Robfen100]

Thanks to all of you for sharing your thoughts and experiences!

I'm really going to be careful this time around, especially if signing a deal on nearly £40k car

I'm no fan of a high Balloon payment jut to save a few quid per month

Now I need to check if our Lloyds current account allows access to this finance product or whether need to open a new Halifax account?

 

[Little Lofty]

If its a new car you don't need to know the reg to try out different specs, deposits, terms etc.

They didn't offer finance on new cars a few months ago, good to know that they do now. Hopefully their rates may spur some of the manufacturers to offer better rates, especially on used. MB is 9.9%, BMW is 10.9% and Audi around the same, crazy considering the base rate.

 

[Dryce]

I'm no fan of a high Balloon payment jut to save a few quid per month

Surely it's irrelevant as to whether it's high or low as you have to look at the complete deal.

All that matters is the overall cost of the deal:

(a) How much you pay up front
(b) Total of payments made
(c) If GFV is low then the likely difference between GFV and actual value you could recover (or treat as a value to you if keeping).

Add it all up (zero for c if the the GFV is higher than the value).

It's then easy to compare against contract hire or finance over the same term apart from making some allowance for the value of keeping the money in the bank if it's a low up front payment.

 

[Robfen100]

Lloyds don't offer the personal PCP finance product (yet!) I chatted to someone from lloyds and 'the computer says no' was only information forthcoming. Still, switching bank accounts is supposed to be easy these days???

But the person from Halifax commented that, being part of the same banking group, they are expected to roll-out the car purchase PCP across their banks at some point, possibly before the end of the year. But he couldn't confirm

I'm in no rush as my Contract has a few months left on it, and if not going back to a main dealer to take out a new pcp early, I'll have to wait until the contract has ended if seeking to do my finance independently

I still have a nagging doubt that when I come to strike a deal, there will be less dealer contribution (AKA discount) if I don't use Mercedes finance therefore cancelling-out the lower APR using Halifax.

 

[Robfen100]

I just found the "thanks" button at last

It was hidden in plain sight

 

[Gene]

Lloyds don't offer the personal PCP finance product (yet!) I chatted to someone from lloyds and 'the computer says no' was only information forthcoming. Still, switching bank accounts is supposed to be easy these days???

But the person from Halifax commented that, being part of the same banking group, they are expected to roll-out the car purchase PCP across their banks at some point, possibly before the end of the year. But he couldn't confirm

I'm in no rush as my Contract has a few months left on it, and if not going back to a main dealer to take out a new pcp early, I'll have to wait until the contract has ended if seeking to do my finance independently

I still have a nagging doubt that when I come to strike a deal, there will be less dealer contribution (AKA discount) if I don't use Mercedes finance therefore cancelling-out the lower APR using Halifax.

I think you are correct.
The dealer contribution is tied into MB Finance
check the T & C
it reads

' Finance offer based on Mercedes-Benz Agility Agreement...... '

 

[Markymerc]

I think you are correct.
The dealer contribution is tied into MB Finance
check the T & C
it reads

' Finance offer based on Mercedes-Benz Agility Agreement...... '

That's right but you can take out Agility to get the contribution then pay off your agreement a week later like I did.

 

[uumode]

Before you enter anything, PCP or personal loan get a benchmark price from CarWow.co.uk

The icing on the cake with PCP is the deposit contribution (depending on the model you are after) which can make the actual cost of the loan cheaper as in my case.

Personal loans often have a £25k limit so PCP enables you to fund a more expensive car if you don't have the £15k 'deposit' (on £40k car). The £25k personal loan monthly repayments will also be quite high compared to PCP.

The deferred PCP balloon payment also accrues interest that adds to the cost of the loan. Car insurance is slightly more expensive I believe because although you are the registered owner, you aren't the legal owner of the car, MB finance is.

Deposit contribution is split into dealer and MB finance contribution. The dealer contribution is part of the dealers margin as that disappeared when I negotiated a discount. The MB finance deposit contribution remains no matter what discount you can haggle.

In the PCP small print I can't find any info pertaining to cooling off cancellations and deposit contribution.