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Should my daughter get a new Mazda CX-5 through PCP or Hire Purchase?
My daughter is looking to buy a new car, but is confused (as am I) about the best method of purchase e.g. PCP or Hire Purchase. She will do around 17,000 miles per year. Currently, Mazda are offering 0 per cent finance on a new CX-5 through Hire Purchase, but with a 50 per cent deposit. She has kept her current Mazda for over six years, so it is likely she may keep a new one beyond three years (which I believe a PCP is based on).
Asked on 14 August 2017 by DuncanEd
Answered by
Honest John
You have to do the sums. Say the CX-5 is £25,000, that makes the deposit £12,500. If they put a GFV (guaranteed future value) of £10,000 on it, then, though you're 'financing' £12,500 at 0 per cent, you're only actually paying back £2,500 which, over 36 months is a mere £70 a month. But, having added your £12,500 deposit, what you are really paying back per month is £417. And then, to keep the car at the end, you have to fork out £10,000 on top.
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