Gary, could you explain the half and third rules please?
I was aware of a rule that if you had made payments to a set value of the car that it couldn't be repossed but that was it.
Donnyboy -> Both bank loans and HP will show up on a credit report it does differntiate between HP/Loan (have a copy of one in front of me) but don't think it makes a difference whether it is a loan or HP from a rating point of view.
I am very cautious about using flat rate as I've known dealers to use this to hide the true APR. In Gary's example he can offer 4% flat rate, which may not be too bad. But if you walked into a dealer and said what's the interest rate and they say 6%, only when pushed do they admit this is the flat rate which many people will think equates to the APR on a bank loan which it doesn't. The like for like comparison is more like 12% APR on the HP (in the 6% flat example), which isn't great when a bank will give you around 8 or 9% APR at the moment.
HP can be the only way of buying a high value car though, walk into a SEAT dealer after a Cupra and with little deposit I'm sure they could sort out a deal on HP or PCP. Try and get a £20K bank loan and most people would struggle.
Many TTs are bought on PCP which is a cheap way of driving round in car you otherwise coudn't afford. Same with other "premium" cars as the resale values are quite high.
On a side note, just seen the depreciation figures quoted after 3 years on a Cupra down to 42%, which is not good at all.
I was aware of a rule that if you had made payments to a set value of the car that it couldn't be repossed but that was it.
Donnyboy -> Both bank loans and HP will show up on a credit report it does differntiate between HP/Loan (have a copy of one in front of me) but don't think it makes a difference whether it is a loan or HP from a rating point of view.
I am very cautious about using flat rate as I've known dealers to use this to hide the true APR. In Gary's example he can offer 4% flat rate, which may not be too bad. But if you walked into a dealer and said what's the interest rate and they say 6%, only when pushed do they admit this is the flat rate which many people will think equates to the APR on a bank loan which it doesn't. The like for like comparison is more like 12% APR on the HP (in the 6% flat example), which isn't great when a bank will give you around 8 or 9% APR at the moment.
HP can be the only way of buying a high value car though, walk into a SEAT dealer after a Cupra and with little deposit I'm sure they could sort out a deal on HP or PCP. Try and get a £20K bank loan and most people would struggle.
Many TTs are bought on PCP which is a cheap way of driving round in car you otherwise coudn't afford. Same with other "premium" cars as the resale values are quite high.
On a side note, just seen the depreciation figures quoted after 3 years on a Cupra down to 42%, which is not good at all.
