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After the test drives, the budget went out of the window. 😄🙈 We're back on the PCP merry-go-round now but we decided to spend more to get something that would do 250+ miles.
Most economical and reliable used EV for £20k
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What interest rate did you get for the PCP?
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That is the market right now. Lots of people are in for a big shock when their current PCP ends. All those people whore used to driving a BMW or Mercedes for £350 a month will have to either pay a lot more or swap to a more-modest car.
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Indeed.
I had four Konas on the shortlist. Happily, the newest one with the fewest miles also had the lowest APR. The highest APR quote I had was 14.9%.
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A quick calculation:
3-years ago someone might have gotten a decent discount on a 3-series or c-class and paid £35k. Financing on a PCP at 3.5%, over 3-years, with £3k down gives a monthly payment of c. £340 (with a £26k "balloon").
Now that has come to an end and our friend wants a new car. However they now want a BEV and there are no discounts to be had, so the purchase price is £45k and interest rates are 9.5%. With £4.5k down the monthly payment has jumped to c. £780 (£27k "balloon").
That is likely to come as a big shock to those who've been reading about "10% inflation".
(At 12% the monthly is c. £840, at 15% it is £930!)
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Since deciding to get rid of the Swift, I've been waiting for interest rates to come down, assuming that it was only a matter of time until they did.
I decided last week that, even if they do come down, they're probably not going to be as low as they were before. It's certainly been a shock but I realised that, instead of waiting for something that may never happen, I needed to adjust my expectations and get on with my life.
I decided last week that, even if they do come down, they're probably not going to be as low as they were before. It's certainly been a shock but I realised that, instead of waiting for something that may never happen, I needed to adjust my expectations and get on with my life.
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No one knows what the future will bring. However I'd warn against "waiting for interest rates to come down. My best guess is that we're a decade away from downward pressure...
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