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Discussion Starter · #1 ·
the car using audi solutions (give the car back at the end of the term and use equity for trade value, walk away if there is no equity or pay of the rest and keep the car )

OR

Hire purchase...buy the car outright?

I have had both option explained to me by audi...but i just wanted to know what other people think is the best way to finance the car?

My scenario is...i might get another car in 3yrs or every 3yrs...but don't want to loose too much money.
 

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To me, it all depends on how often you change you car. If you plan on exchanging after 3 years, having a set figure for buying the vechile back cant be bad. And in the present market its probably best imho
 

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If you want fixed costs then have a look at Contract Hire.

Upside: You have a fixed monthly payment, Road Tax is included and you can add maintence (including tyres if you want) for an additional monthly fee. Low deposit - typically 3 x monthly payments.

You drive the car for three years and then give it back and start a new agreement.

Downside: If you need to get rid of the car during the term, the penalties can be massive (as much as 9 monthly payments in some cases)
You are effectively renting a car for three years and never build up any equity.
Penalties for going over the agreed mileage can be steep.

The Audi Solutions make deals look attractive by keeping the monthly payments down but the interest charges are high.

Personally, I would put down as much of a deposit as you can afford and then get a conventional HP agreement for the rest. Maximum flexibility and if you want to keep the car at the end of it, you can.


As for your final sentence about not losing too much money, don't buy a car if you want to do that!! They are depreciating at the fastest rate that they ever have right now, irrespective of make and model.
 

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Discussion Starter · #5 ·
.

Personally, I would put down as much of a deposit as you can afford and then get a conventional HP agreement for the rest. Maximum flexibility and if you want to keep the car at the end of it, you can..
Im really not sure what you ment. I usually buy a car and pay it monthly...at the end you keep it. But the monthly figure is high. Im not a business user...it would be for personal.

http://www.audi.co.uk/audi/uk/en2/Financial_Services/Financial_Products.html

What i presume you were saying is you would by the car and pay monthly to own it outright. During this you have flexibility. In say millege, what you do to it, etc. At the end you can sell it to the dealer or sell it privately and at a rate more than the dealer is offering to give for the car.
 

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I guess a lot depends on your circumstances.

I had a reasonable deposit to put down (roughly a 3rd of the value of the car)

I then obtained a personal load through Barclays which calcualtes out at a straight 4% per annum cost for the loan (the APR is 7.3%). i.e total cost of the borrowing was around 16% of the loan value. I have done this over 4 years and have managed to get an excellent speced car whilst paying under £500/month.

The next point to consider is your mileage. If your a high mileage driver your going to pay big time with a lease / pcp. I considered all sorts of different ways including pcp, lease with baloon payments etc etc. At the end of the day, even with a healthy deposit I was looking at over £720/month for a well specified lease car and the baloon was around a third of the cars original purchase price at th end. (Have a look at bank of scotland freeway website this will enable you to play some tunes on difference deposit, mileage, lenght of lease etc and should give you an indication of your likley costs)

Running costs will be the same roughly if you lease or not.

So anyway, i'm hoping when i come to change the car in 3 / 4 years, my cash deposit will still be in the value of the car and I will then use that to buy my next one. It may not work, and there is probably a bit more risk in terms of buying outright as i cant simply hand back to a leasing company, but my view was that the savings greatly outweigh any risk. In terms of what my car will be worth in 3 years with 75K in the clock, thats anyones guess but again looking at the BOS freeway site it suggests there should be some fairly good residuals in the A5's........subject to the world not having gone into total financial meltdown.......and if it does.....i'll just keep it a bit longer.

Anyway thats my 2p's worth........not sure if its any help.....but hope so

G
 

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Discussion Starter · #7 ·
thanks, your opinions are helping. I think HP would be better for me. As if i lost my job or my future circumstances change...i don't need to worry about it.

I know with the HP you can also pay the agreement early...im doing that shortly. I won't be flogging my current car to audi! They would only give me £4500 for it. Whereas the same car, spec on the net is getting £7000-9000! I know the dealer would flog mine for £10k. Stupid isn't it?
 

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What i presume you were saying is you would by the car and pay monthly to own it outright. During this you have flexibility. In say millege, what you do to it, etc. At the end you can sell it to the dealer or sell it privately and at a rate more than the dealer is offering to give for the car.
Correct. :D
 

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I am fortunate enough to be able to buy a new car outright as I did with my current A3. What I have learnt in the A5 buying process is that you can get a good deal on a new one but the moment you bring a part-exchange into the equation the deal goes tits with silly prices and/or no discount.

Therefore I have resigned myself to trying to sell my 2006/06 A3 2.0TDi S Line S-Tronic with Sat Nav privately. If I can't sell it then it looks like no new A5 for me.:(
 

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Discussion Starter · #10 ·
what were they offering you part-ex? Do you reckon you'll have much luck selling it privately?
 

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I was offered £12,285 which is not too bad, for a part-ex price, but then no discount on the A5. If I just buy the A5 I can get 10% off!! The deals are clearly structured to make it very unattractive for part-ex's. I presume simply because they do not want any stock depreciating on their forecourts.

Also I have contacted three dealers (2 x Audi and 1 x Independent) who advertised as buying Audi's but not one has returned my calls/messages!

To be honest whilst I will price my car below guide to try and sell it I am not holding out too much hope. Just ask Booster how his A3 sale went!
 

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Discussion Starter · #12 ·
10% off! thats really good. The market is doing really bad! If i go to sell mine by the summer i bet they won't give me much for it...guess i will have to save a big deposit!
 

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Give this guy Ryan a call on 01438 791782 he'll explain all the differences - he did for me before I got my A5 on personal contract.
 

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I got mine with the three part finance, deposit, 36 monthly payments then choose pay the final amount walk away or trade in.

I dont think its the cheapest but i like the final stage options.
 

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Discussion Starter · #15 · (Edited)
hi bob. thanks for that. I've now decided to use this option. I usually use the hire purchase. The finance plan you have is the solutions. Im going for that. Min deposit and smaller monthly payments. Allows me to save my cash and drive a car i want. I noticed at the end of the 'audi example term on the a5' the car would only cost £19000. Obviously 33k+ if you decide to keep it. There might even be another car in 3yrs that take my fancy...always happens!
With the other 12/13k you would save on the depreciating asset. You would loose that amount of cash, plus the HP interest...


The only bit im worried about is the minus equity...

Although i know im kinda answering my own Q here, but everyone and my research has helped me. It would suit my finance. I wanna get into this car, but want the best route. I think HP i would loose too much as it won't be worth that in 3yrs time. I guess no matter what route though im still gonna be given my money to someone to host the christmas annual ball. Whether its the bank loan, dealership or the manufacture.

Dunno if any one has an opinion on this, but i found that there's no point throwing too much money into a car that will depreciate? I just want the minimal hassle of getting rid of it, if need be at the end of the term. Rather then worrying if someone will be willing to buy the car from autotrader?

I also get over precious with my cars as i owned them. Like 'for f's sake! if i get stone chips, minor scratches, etc' Whereas this kinda takes the edge of things, knowing i can give it back and let it be someone elses prob. (not talking about noticed damage, just were and tear damage. As mentioned stone chips or stone scrapes, bird sh*t burn marks, paint defects, etc!)

I love my cars to always look new. I'm not saying that if i don't own it i don't care about it. I'll still look after the car. Love them shinny and glossy! :D
 

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The dealer sold me the package based on the three options at the end.
If you dont like the car and cant afford it and it worthless at the end just walk away.

If you like the car, and want to keep it pay off the remaining finance.

If you want a new car and the car is worth more than finance trade it in use the money to pay of the finance and the profit toward the new car.

But I am under no illusion the dealer isnt getting a good deal out of this, even if it is wrapped up in an attractive package. The will earn a nice commission on over £6,000 interest I will be paying, they also have the benefit that they are more likely to get a guaranteed repeat customer in three years. Although you could trade it in at another dealership including another make of car, this pays of the finance and you keep the profit.

I do remember there are catches though, you sign up to an estimated mileage and this helps them calculate the final value, if you go over the milage you pay per mile (Its 6p a mile, so thats less than £400 if you go over 6000 miles in three years). Also you have to keep the car in good repair and a decent condition, so no kerbing it, scratches and keep it serviced, I also dont think they would appreciate you smoking 40 a day in the car.

But the dealer wants the car to be enjoyed and actually be worth more than the final finance, so you can afford a bigger deposit for a bigger car next time.

Like any finance package its best to know all the good and bad points happy shopping.
 

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£6000 interest on a 30k car... What rate of interest is that.
 

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Discussion Starter · #18 ·
it prob is best i went with this option. If i was to own the car, to keep the payments down i may aswell take it over 5yrs...but then on the 5th year to sell it would be pointless. I may as well have gone for the option as mentioned. How long have you had the A5 for? As for kerbing...a minor scuff is allowed?
 

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£6000 interest on a 30k car... What rate of interest is that.
12.6%, as I said I know it doesnt make complete financial sense, there are a couple of other fees and costs in there on top of the car. It should be 10% but its all down to the stupid way APR works itself out.

There is no such thing as good credit except 0% and if I liked that so much I would be driving a Fiat now.
 

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Discussion Starter · #20 · (Edited)
if you get a used car thats only a few months old, so they still give you the 3yr warranty...or is it only 12months?

On a 27k car, what kind of finance could i be looking at? I know it varies from car to car...but the best i could find was on the audi site:

35 monthly payments of £359
Customer deposit £6,275.22
On-the-road retail cash price £27,030.00
Amount of credit £20,754.78
Optional final payment £13,478.22
Total amount payable £32,378.22
Acceptance fee* £125.00
Option to purchase fee** £60.00
Excess mileage 7.05p p/mile

10.8% apr
Does anyone pay any better than that example on their car?
 
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