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Buying vehicle with a Personal Contract Plan


AcidRain

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Hi guys,

Has anyone in here tried to get a vehicle through https://autodirect.lk/ ? Vehicles has to be buy based on  a PCP (Personal Contract Plan) which seems attractive as the monthly payment comes down considerably compared to a conventional leasing payment. However,   eventually paying similar amount as the lease.  Just want to know pros/cons of this approach  if anyone has already tried this in here or abroad.

Thanks in advance

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  • i think this is something similar to a Dry operating lease where ownership is transferred after the final bulk [payment. The rental is reduced by having a very large residual installment. I do not think it has any benefit to the buyer. You are better off having a wet operating lease insead and forget about the vehicle selling price, maintenance etc etc
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I have being following this scheme and below are what I have found.

There are 2 parties (currently) I know who are facilitating this scheme of selling vehicles. The buyers are required to pay a minimum of 30% of the value of the vehicle upfront and the "lease interest" of the balance 70% of the value is paid monthly. Last time I calculated it was at 17% per annum. This payment of interest goes on for 3 years and at the end of the 3 years, the buyer should pay the balance and transfer the ownership or sell the vehicle in the open market and pay the balance or return the vehicle. 

Recently the agent for BMWs have started the this scheme of paying only interest. But their offer is to pay the interest for the 1st year and then the capital payment coming in from year 2 onwards. 

I am not sure of the exact terms and conditions of running restrictions etc... in the agreement but this method is very popular among the private sector employees who generally match their vehicle allowance to the monthly interest payment and they cycle the car every 3 years. 

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