# PCP possibly overcharged interest?



## Macauley (May 31, 2017)

Hi all,

Due to the recent news of car loans being over charged interest I decided to look at mine in detail. After using multiple online PCP calculators, they all came to around the same monthly payment which is actually £66 less per month to what I'm paying. Here's the numbers:

Vehicle cash price: £30,995.60
My deposit: £2,328.25
Dealer contribution: £4,000
Final payment: £13,846.25
Fixed APR: 6.2%
Period: 46 months
Monthly payments: £330

After working out what I'm being charged interest on it came to £10,821.10. The calculators say that's about £264pm. Is it me or has someone done something dodgy for that extra commission?

Thanks in advanced.


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## HOGG (Mar 30, 2018)

Not really. Because overall you've only paid approx £4500 over the cost price

Sent from my SM-G930F using Tapatalk


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## VorsprungDur (Apr 6, 2018)

Macauley said:


> Hi all,
> 
> Due to the recent news of car loans being over charged interest I decided to look at mine in detail. After using multiple online APR calculators, they all came to around the same monthly payment which is actually £66 less per month to what I'm paying. Here's the numbers:
> 
> ...


You are missing the fact that you are also borrowing £13.846.25 for the entire duration of the loan.

Look for a PCP calculator not a loan calculator. The one I just tried came up with £336 a month using your figures. The extra £6 a month is probably due to a timing difference and/or the APR not being exactly 6.2%.


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## Rukka (May 9, 2017)

As above. I've just worked this out on a PCP calculator and it comes to £336.45 a month.

Try using this online calculator - it's spot on.

http://www.pcpcal.co.uk

Rukka


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## Ddave (Mar 6, 2019)

Hi gents.
I also have an issue with potential overpayment for PCP for my TTS. Would be grateful for any advice please.

Cash price: £46,885
My deposit: £15,317
Dealer contribution: £5000
Final Payment: £18782.95
Fixed APR: 6.74%
Period: 48 months.
Monthly payments: £159.12

The calculator states that we have been overcharged by £114.06 per month. Am I missing something here?


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## 90TJM (Sep 30, 2013)

I put down a large deposit on my Mk2. Using the Audi online Calculator the payments were just over £100 a month.When I went to the dealer the payments went up to over £200! I paid just over £100 a month.Dealers will rip you off and let you pay over the odds.


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## VorsprungDur (Apr 6, 2018)

Ddave said:


> Hi gents.
> I also have an issue with potential overpayment for PCP for my TTS. Would be grateful for any advice please.
> 
> Cash price: £46,885
> ...


You should be paying £290.98 a month.

At £159.12 a month the interest rate would have to be less than 0% for that to be true (i.e. negative).

£46,885-£15,317-£5,000-£18,782.95=£7,785.05 (the capital that needs to be repaid on a monthly basis)

£7,785.05/48 = £162.19

The interest on a PCP loan for that period would be £6,181.99

£6181.99/48 = £128.79

So monthly payments equal capital + interest = £162.19 + £128.79 = £290.98


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## ZephyR2 (Feb 20, 2013)

So here we have a couple of posts by members who, from the content of their posts are literate, well educated and can do some maths for themselves. Yet still they are confused by their PCP deals and aren't sure what they are paying for or how it works.
This is worrying as no doubt this is just the tip of a very large iceberg. If these guys are having trouble with PCPs what does it say for the chances of the wider population who are being sucked into these deals.


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## Rukka (May 9, 2017)

Ddave said:


> Hi gents.
> I also have an issue with potential overpayment for PCP for my TTS. Would be grateful for any advice please.
> 
> Cash price: £46,885
> ...


Something not quite right there as no way should you only be paying £159.12 a month. And you think you are being overcharged by £144.06 per month too? So you expect to be paying £45.06 a month???

Or am I missing something?

As already stated, your monthly payment works out at £290.98 a month and you're figures above can't be right.


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## leopard (May 1, 2015)

ZephyR2 said:


> So here we have a couple of posts by members who, from the content of their posts are literate, well educated and can do some maths for themselves. Yet still they are confused by their PCP deals and aren't sure what they are paying for or how it works.
> This is worrying as no doubt this is just the tip of a very large iceberg. If these guys are having trouble with PCPs what does it say for the chances of the wider population who are being sucked into these deals.


PCP has always been a mug's game if the intention is to hand the car back, pretty much a mug's way of buying a car also...

Much better to lease and hand back at the end of the duration.


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## VorsprungDur (Apr 6, 2018)

ZephyR2 said:


> So here we have a couple of posts by members who, from the content of their posts are literate, well educated and can do some maths for themselves. Yet still they are confused by their PCP deals and aren't sure what they are paying for or how it works.
> This is worrying as no doubt this is just the tip of a very large iceberg. If these guys are having trouble with PCPs what does it say for the chances of the wider population who are being sucked into these deals.


The problem is financial literacy.

Anyone can work out a simple flat rate loan but when you start using APR and have a sum which is never repaid it becomes a lot more complex.

There are plenty of good PCP calculators online, the link above is one of them.

Why is this viewed as a mugs game?


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## Ddave (Mar 6, 2019)

leopard said:


> ZephyR2 said:
> 
> 
> > So here we have a couple of posts by members who, from the content of their posts are literate, well educated and can do some maths for themselves. Yet still they are confused by their PCP deals and aren't sure what they are paying for or how it works.
> ...


No, not a mug, not handing the car back. Don't especially appreciate the sentiment of your message though.


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## Macauley (May 31, 2017)

leopard said:


> ZephyR2 said:
> 
> 
> > So here we have a couple of posts by members who, from the content of their posts are literate, well educated and can do some maths for themselves. Yet still they are confused by their PCP deals and aren't sure what they are paying for or how it works.
> ...


I wouldn't really say it's a mugs game at all, it worked out better for me financially


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## 90TJM (Sep 30, 2013)

There is no way I would draw out over £30K from the bank and buy a new car,but the PCP allows me to buy that £30K car without taking £30K out of the bank as it would never go back in.I work with many people who are paying over a grand a month to rent a "shoe box",now that is a mugs game.


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## Ddave (Mar 6, 2019)

Agreed. If you are investing your finances very wisely then it makes little difference over PCP or HP, if done correctly the finance should be small change by comparison anyway.


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## leopard (May 1, 2015)

Ddave said:


> leopard said:
> 
> 
> > ZephyR2 said:
> ...





Macauley said:


> leopard said:
> 
> 
> > ZephyR2 said:
> ...


Make your minds up. You have both come on this thread whining that you've been bent over, that your monthly payments aren't to calculated expectations. Now you're defending the situation :?

Of course it's a mugs game, look at the interest you're paying, the mileage that you've agreed to and the payment that you'll have to pay on the back end when you get bored after 48 months or whatever it is. The honeymoon period will be well over by, let's see, 24months :lol:


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## Macauley (May 31, 2017)

leopard said:


> Make your minds up. You have both come on this thread whining that you've been bent over, that your monthly payments aren't to calculated expectations. Now you're defending the situation :?
> 
> Of course it's a mugs game, look at the interest you're paying, the mileage that you've agreed to and the payment that you'll have to pay on the back end when you get bored after 48 months or whatever it is. The honeymoon period will be well over by, let's see, 24months :lol:


First of all, we wasn't whining that we've been bent over, just needed some clarification. Secondly, not everyone can get accepted for a bank loan or afford a very high monthly payment, so PCP solves these problems.[/quote]

All these loan options are there to suit everyone's individual needs. If you've been able to buy your car with your saved up money then good for you, but remember the choice people make on how they buy their cars is none of your business, nor does it need your criticism.

P.S. Going 2 years on, I'm still very happy with my car and don't plan on changing it any time soon.


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## leopard (May 1, 2015)

Macauley said:


> but remember the choice people make on how they buy their cars is none of your business, nor does it need your criticism.
> .


Idiot ! You've made it everybody's business by posting on a forum about potentially dodgy dealing in your first post. If you don't want criticism don't post, simples ...


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## Macauley (May 31, 2017)

leopard said:


> Macauley said:
> 
> 
> > but remember the choice people make on how they buy their cars is none of your business, nor does it need your criticism.
> ...


 :lol: I think you're missing the point.


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## leopard (May 1, 2015)

Macauley said:


> leopard said:
> 
> 
> > Macauley said:
> ...





Macauley said:


> After working out what I'm being charged interest on it came to £10,821.10. The calculators say that's about £264pm. Is it me or has someone done something dodgy for that extra commission?


Enlighten us


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## Macauley (May 31, 2017)

leopard said:


> Idiot ! You've made it everybody's business by posting on a forum about potentially dodgy dealing in your first post. If you don't want criticism don't post, simples ...


 :lol: I think you're missing the point.



leopard said:


> Enlighten us


I don't see what you're trying to prove, I posted this thread for clarification, not criticism from you. This is going off topic now and I don't want to waste my time anymore talking to someone who is clearly looking for a fight. Enjoy the rest of your day.


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## Ddave (Mar 6, 2019)

leopard said:


> Make your minds up. You have both come on this thread whining that you've been bent over, that your monthly payments aren't to calculated expectations. Now you're defending the situation :?
> 
> Of course it's a mugs game, look at the interest you're paying, the mileage that you've agreed to and the payment that you'll have to pay on the back end when you get bored after 48 months or whatever it is. The honeymoon period will be well over by, let's see, 24months :lol:


Never claimed I'd been bent over, I haven't, perhaps that's your forte, dunno?.. I wanted to check what other owners thought. I don't give a shit either way actually but I wanted some 'friendly' advice. Seems to be somewhat lacking round here, especially by certain,... people. :wink:


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## Toshiba (Jul 8, 2004)

Anything to do with finance there's only going to be one winner - the lender.

I understand the sentiment of some around not drawing out the cash from the bank but the interest on saving is much smaller than whats charged on a loan. So even on the R8 i'm still in front having paid cash. Yes i took advantage of the finance agreement but paid it off in 5 days.

The only time i see a PCP working is if you couldn't normally afford a car of that value, you are simply financing depreciation or if you would normally get a loan to pay for it, PCP rates are generally better with the contribution. But each to their own, it's your money...


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## ZephyR2 (Feb 20, 2013)

@Ddave and Macauley - a word of advice ...... Don't feed the troll. :lol:


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## VorsprungDur (Apr 6, 2018)

Ddave said:


> leopard said:
> 
> 
> > Make your minds up. You have both come on this thread whining that you've been bent over, that your monthly payments aren't to calculated expectations. Now you're defending the situation :?
> ...


Talking of friendly advice/feedback......

Now that you've stopped fighting with someone who was deliberately winding you up.

I posted the calculation for what you should be paying on a PCP, it didn't tally with any of the figures you mentioned.

You've not made any comments on the difference.

Were your figures wrong or did the dealer make a massive cock up?


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## Ddave (Mar 6, 2019)

Toshiba said:


> Anything to do with finance there's only going to be one winner - the lender.
> 
> I understand the sentiment of some around not drawing out the cash from the bank but the interest on saving is much smaller than whats charged on a loan. So even on the R8 i'm still in front having paid cash. Yes i took advantage of the finance agreement but paid it off in 5 days.
> 
> The only time i see a PCP working is if you couldn't normally afford a car of that value, you are simply financing depreciation or if you would normally get a loan to pay for it, PCP rates are generally better with the contribution. But each to their own, it's your money...


Incorrect, if you invest wisely in the stock market and other things you can (and I DO) make MUCH more than any PCP etc will change me. My issue is, I'm unfamiliar with the semantics of these specific finance deals which was why I asked some of you guys.

VorsprungDur. Turns out that the dealership had made a slight,... error. Apologies.

P.S. Don't worry, I don't intend to feed the trolls. Thanks to everyone else who actually gave some constructive comments.


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