Deposit contribution

[Sparky pete]

Anybody offered dealer deposit contribution on finance only deal then payed it off within a couple of months, if so was there any penalty.
Apparently I can’t have the deposit contribution for an outright sale. My concerns are any penalty / interest will cancel out the contribution.

[wessie]

You will need to read the small print as terms change all of the time, but there was no penalty for early payment on my BMW bike via HP or Audi car via PCP. I had a deposit contribution on both.

If there was an early settlement fee a lot of people would be put off ending their PCP early to upgrade to a newer model.

[darthdicky]

I'm thinking of doing this too but have the same reservations. Just asked here as well and the view seems quite positive https://www.ukgser.com/forums/showthread.php/574929-Taking-finance-on-a-new-bike-and-paying-it-off-worth-it?p=6233988#post6233988

[Diavel]

Out of curiosity it might be worth checking with BMW Finance what would happen if you wanted to settle before the first payment was due?Generally the majority of interest bearing finance agreements have some form of settlement penalty.With PCP it may be harder to identify as there is also a cost component related to maintenance.If the dealer is offering a contribution then it is likely that they will receive some form of finance commission to offset.It is easier to calculate the settlement figure with an HP agreement if the dealer contribution is available for this?

[wessie]

Originally Posted by Diavel

Out of curiosity it might be worth checking with BMW Finance what would happen if you wanted to settle before the first payment was due?Generally the majority of interest bearing finance agreements have some form of settlement penalty.With PCP it may be harder to identify as there is also a cost component related to maintenance.If the dealer is offering a contribution then it is likely that they will receive some form of finance commission to offset.It is easier to calculate the settlement figure with an HP agreement if the dealer contribution is available for this?

In the UK, PCP does not have a maintenance component. It is more like a HP contract with a deferred payment rather than a lease.

The only penalty with PCP is if the vehicle is returned to the finance company at the end of the contract with a higher mileage than declared. The higher mileage will affect the GFV (guaranteed final value) and there will be a "pence per mile" charge. If the GFV is paid to the finance company then the vehicle mileage does not matter.

If you follow the link I posted, there is plenty of anecdotal evidence that there are no penalties or clawback from BMW if PCP finance is settled early.

If you think about it, even if you pay off the finance, just going through the checks to get finance means BMW has a lot of data on you that they can then use to market more services at you. This data is probably worth more than £500 to them...

[Gazk]

Originally Posted by Tacticalnuclearpenguin

Anybody offered dealer deposit contribution on finance only deal then payed it off within a couple of months, if so was there any penalty.
Apparently I can’t have the deposit contribution for an outright sale. My concerns are any penalty / interest will cancel out the contribution.

Yes, I did that, I traded my 16 plate against an M-sport 21 plate "a bit of haggling and an ok price from the dealer" I got £**** of the new XR and the took the HP\ PCP which took another £500 off payed the £500 off which cost £35ish after the 15days, and enjoyed the money off.

Yes, I could have sold the 16 plate XR private for a bit more and yes, I’m in the luck position that I could have paid cash for the New XR.  Selling privately, it’s dealing with time wasters and odd ball’s looking round and as time verses money was the calculation and the sure as Hell do not pay me in time at work.

I went for the easy option and in my humble opinion the better option for me.
 

[Mareng1]

Does the 'haggled figure' not get influenced by the dealer getting the commission on the PCP deal from the manufacturer?

Then they lose that commission when the purchaser pays off the entire sum a week later?

[Winger]

We go to a bike meet of a Wednesday morning, mentioned this thread, 2 of the guys had done as suggested with cars as in gone the finance route and then paid it off, the big debate was how long you wait to do so, but one of them has a new GS coming in March I asked when and the reply was ‘When it stops raining’ but when an extra 500 quid was mentioned as opposed to a debit card he said he’d ask if the OP can hang on a couple weeks to find out.

[Winger]

3 page article on bike purchase(from a BM dealer)in the comic that turned up today a day late.

[Sparky pete]

What comic was it?