New car finance options

I‘ve done some Googling, checked the MSE car buying advice and looked at Honda’s own websites.

(The car we’re interested in is the CR V AWD petrol hybrid, new in 2021),

PCP is definitely out. If we chose not to keep the car after 3 years we would need to find around £10,000 deposit for a new car. If we chose to buy it after 3 years we would need to make a final payment of £18,000. Any mileage over 1,000 per year incurs an extra charge of £0.11 per mile. We can easily cover that in a month, let alone a year! I think this option only really works if you’re buying a smaller, less costly, car and doing mainly local journeys.

HP would cost us around £1,000 extra, but it does include 5 years complementary servicing.

Honda offer a 5-year service plan for new cars which costs £650, so unless I’ve done my sums wrong it looks as though my best option is cash upfront, with a service plan.

This has been an interesting exercise, there’s so much to consider!

Input not uncut!

Thanks for your uncut all, We had 3 years free servicing with the Subaru Forrester, which we bought new and paid cash. We haven’t had a used car for several years, not that there’s anything wrong with that if it’s what you’re comfortable with. The one we want is a new 2021 model so not available used anyway. The main dealer has told us delivery on this is around one month. Time isn’t really an issue, though if it can’t be delivered until 2022 I’ll want a 22 plate. If I take advantage of the manufacturer finance offer there is a choice of HP or PCP and both of them come with 5 years free servicing, which is worth quite a lot.

We've just bought a 2017 car for cash and no trade in. Never known one offer free services for finances or cash.

It all depends on the dealer. Our Audi dealer had a 2 year warranty as part of the deal for month of May.

I read with interest the likes of cazoo who are doing car subscriptions, including insurance and servicing with a 1000 mile a year limit. Keep it for as long or short as your like I think!

We never buy new cars, usually buy a 2 year old car from Motorpoint with a low mileage and pay cash. We also keep our cars for several years. Our current cars are 2012 and 2013, both still fairly low mileage. One of the cars is the dog car, it's small, easy to park and the dog travels happily in it for local journeys. The other car is bigger and more luxurious and does the long journeys or is used when we both need a car. TBH we are not really interested in cars, just want something that does the job so we are not typical. I also have a horse lorry which is a money pit!

I’m also looking at new cars, as are thousands of other people judging by the delivery dates I’ve been quoted - December for some makes! I had decided on the model only to find they have discontinued it in an automatic version which I had set my heart on! So I’m now going to test drive a manual version and also an automatic in the next size model.

I don’t think leasing is for me as my monthly income is really only enough for my basic, everyday living costs. Large cost items such as cars, holidays, home improvements etc come from investments and pension drawdown. So to pay a significant amount each month would mean me keeping a careful eye on my current account and transferring money across several times a year. But I’m still going to weight up the finance options as long as the car does not cost any more. I usually keep my car for longer than three years so again something I need to consider.

We always do PCP which one can do with or without servicing options. We have occasionally paid the bubble and kept the car a while longer.

I’ll watch this thread with interest. As I’m now on my own, a friend told me that PCP is the way to go. A new car every 3 years and no bills - just a monthly payment. Of course the car’s never owned (unless you opt to pay a final bubble payment) but most cars would depreciate by 1/3 in the first 3 years, so that’s got to be factored in against buying outright?

We take the finance if it is interest free.
If they are charging interest then it negates any incentives (free servicing).