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      12-06-2018, 04:57 PM   #1
richatha
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12 months in can I get rid?

So almost 12 months in on the 340 and I was just wondering if you can VT or is it only after 24 months you can? I think my circumstances might change in the future and I may need to get something cheaper but wondering what my options if anything are?

It's a sad time in my life to have to ask this but it might be the easiest thing to reduce costs down.

Any thoughts?
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      12-06-2018, 05:11 PM   #2
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You can VT once you have paid 50% of the total financed amount. You will be a good 10 grand off that after a year id imagine. Better off selling it if you really need to.
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      12-06-2018, 05:15 PM   #3
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If we're talking PCP you can't VT at 12 or even 24 months. Its only once you've paid off 50% of the total amount payable which includes the gmfv. Its usually around month 40 on a 4 year PCP.
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      12-06-2018, 05:33 PM   #4
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You could also see if anyone wants to take over the car and payments.
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      12-06-2018, 05:35 PM   #5
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Quote:
Originally Posted by ROCKETRON View Post
You could also see if anyone wants to take over the car and payments.
Very unlikely, as they’d be paying for a new car but getting a 1 year old car!!
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      12-06-2018, 05:42 PM   #6
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Quote:
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Very unlikely, as they’d be paying for a new car but getting a 1 year old car!!
But they also would have no deposit to pay and be paying payments for a year less than original deal. It would of course depend on the original deal.
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      12-06-2018, 05:42 PM   #7
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You can VT anytime but you have to pay half the finance including interest off...would be a vast amount at this point..

The only thing really to do is sell privately or dealer, then you owe the difference between what you get for the car and what you owe.. you will get some interest relief this way, but i still suspect there will be a number of 000's difference..
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      12-06-2018, 05:45 PM   #8
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Quote:
Originally Posted by ROCKETRON View Post
But they also would have no deposit to pay and be paying payments for a year less than original deal. It would of course depend on the original deal.
Ok I suppose if he paid a huge deposit then it could be a small enough monthly to be tempting.
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      12-06-2018, 07:28 PM   #9
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Quote:
Originally Posted by un1eash View Post
If we're talking PCP you can't VT at 12 or even 24 months. Its only once you've paid off 50% of the total amount payable which includes the gmfv. Its usually around month 40 on a 4 year PCP.
It isn't as clear as that, loads of things affect when your VT date is. Your deposit being one and BMW deposit contribution being another. The bigger the deposit, the earlier the VT point as both are deducted from your half way payment. If you've put a big deposit in yourself you're wasting money by VTing, as that money is spread evenly across the whole period of your pcp. If you VT early, you throw away a proportion of your deposit.

Mileage and higher monthlies also make a difference. Personally I paid zero deposit as I know I'm likely to want to VT so don't like to waste the money. Even with zero deposit my VT point is at month 31 of 48 due to the high mileage and higher monthlies.

Best thing to do is ring your finance company and they will tell you your VT point. Or post on here your deposit, total price payable including interest, BMW deposit contribution and monthly payment and I, and I'm sure many others too will able go tell you when you're going to reach your VT point. It's highly unlikely to be month 24.
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      12-07-2018, 03:06 AM   #10
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Thanks everyone it was what i suspected it to be. The VT is is half the RRP or half of what I paid?

It's not that I don't love the car i'm besotted with it but it's the pure financial impact it's having that might not be able to continue but I do normally look at the worst case scenario before I actually know anything.

Reading your comments my deposit was similar and being low but we do low mileage but if it comes to it i will phone the finance department up and see what they say.

Thanks guys!
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      12-07-2018, 03:13 AM   #11
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Quote:
Originally Posted by richatha View Post
Thanks everyone it was what i suspected it to be. The VT is is half the RRP or half of what I paid?

It's not that I don't love the car i'm besotted with it but it's the pure financial impact it's having that might not be able to continue but I do normally look at the worst case scenario before I actually know anything.

Reading your comments my deposit was similar and being low but we do low mileage but if it comes to it i will phone the finance department up and see what they say.

Thanks guys!
Your VT point is:
The price actually paid plus the total interest due for the full PCP term, divided by 2.
Minus your deposit.
Minus the BMW deposit contribution (shown on finance paperwork, not dealer discount which won't show).
Divide that new figure by your monthly payments and that gives you your VT point.

Or, ring BMW.
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      12-07-2018, 03:21 AM   #12
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You can also give the car back and settle whatever is outstanding on the finance but that will probably be a lot.
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      12-07-2018, 03:23 AM   #13
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Op. Do you have a lump money you could pay into your finance to get the monthly payments lower?

if not. you might want to look at how much you need to pay to walk away from the car and if the money would be better spent lowing the monthly payments and keep it. with all of its new car benefits. such as warranty.
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      12-07-2018, 03:24 AM   #14
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Quote:
Originally Posted by Goneinsixtyseconds View Post
It isn't as clear as that, loads of things affect when your VT date is. Your deposit being one and BMW deposit contribution being another. The bigger the deposit, the earlier the VT point as both are deducted from your half way payment. If you've put a big deposit in yourself you're wasting money by VTing, as that money is spread evenly across the whole period of your pcp. If you VT early, you throw away a proportion of your deposit.

Mileage and higher monthlies also make a difference. Personally I paid zero deposit as I know I'm likely to want to VT so don't like to waste the money. Even with zero deposit my VT point is at month 31 of 48 due to the high mileage and higher monthlies.

Best thing to do is ring your finance company and they will tell you your VT point. Or post on here your deposit, total price payable including interest, BMW deposit contribution and monthly payment and I, and I'm sure many others too will able go tell you when you're going to reach your VT point. It's highly unlikely to be month 24.
Or, unless you are on a 0% deal, you waste money by putting in less deposit as you then pay more interest.

What matters is how much you actually pay over the period you have the car, if you have cash up front throwing that in knowing you are likely to keep for 3 years not 4 is OK if interest rate on PCP is higher than that money is generating.

For me I had £9k sat in an account earning 0.5%, and was financing at 5% plus. I chucked in the £9k based on £3k a year, even though its a 4 year PCP. I am unlikely to VT but might not keep the car to term. Alternatively, I might decide to keep it at 4 years. I may pay down the outstanding monthly payments and just owe the GFV in next few months. I may pay it all off. Who knows - but I did know that I was happy to chuck in the £9k to make monthly payments less...

Plus putting in deposit means you have a fighting chance of being in positive equity if you need / want to sell early - like in this case. Although I guess if you hadnt put in the cash you would have it in an account to clear the negative....

Maybe zeroFX has it right and we should all buy cash outright and keep it simple
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      12-07-2018, 03:34 AM   #15
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Quote:
Originally Posted by Goneinsixtyseconds View Post
Quote:
Originally Posted by richatha View Post
Thanks everyone it was what i suspected it to be. The VT is is half the RRP or half of what I paid?

It's not that I don't love the car i'm besotted with it but it's the pure financial impact it's having that might not be able to continue but I do normally look at the worst case scenario before I actually know anything.

Reading your comments my deposit was similar and being low but we do low mileage but if it comes to it i will phone the finance department up and see what they say.

Thanks guys!
Your VT point is:
The price actually paid plus the total interest due for the full PCP term, divided by 2.
Minus your deposit.
Minus the BMW deposit contribution (shown on finance paperwork, not dealer discount which won't show).
Divide that new figure by your monthly payments and that gives you your VT point.

Or, ring BMW.
The above sets-out how to calculate your VT point although if you're unsure calling BMWFS will be the best option as they'll give you a definitive answer immediately!

I suspect you know it already but buying a new car and looking to bail-out after 12 months is usually bad news financially. Even if you got a decent discount you'll still be looking at heavy depreciation over the first couple of years so if finances permit it may be better to grit your teeth and keep the 340i a bit longer?

Hopefully your circumstances won't force you into getting rid early but in any event good luck with it all.
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      12-07-2018, 04:35 AM   #16
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Quote:
Originally Posted by Goneinsixtyseconds View Post
Your VT point is:
The price actually paid plus the total interest due for the full PCP term, divided by 2.
Minus your deposit.
Minus the BMW deposit contribution (shown on finance paperwork, not dealer discount which won't show).
Divide that new figure by your monthly payments and that gives you your VT point.

Or, ring BMW.
I think on mine, that works out at month 27 of 48. Not that I plan to VT.
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      12-07-2018, 04:54 AM   #17
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Get a settlement figure from BMWFS and then see what you can sell the car for that will show you the position in terms of your exposure, far to early to be able to VT on a 48 month contract.

These 48 month pcps are a bit of a trap.
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      12-07-2018, 07:17 AM   #18
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On my last car, I VT'd at month 37/48.
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      12-07-2018, 08:11 AM   #19
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Quote:
Originally Posted by isleaiw1 View Post
Or, unless you are on a 0% deal, you waste money by putting in less deposit as you then pay more interest.

What matters is how much you actually pay over the period you have the car, if you have cash up front throwing that in knowing you are likely to keep for 3 years not 4 is OK if interest rate on PCP is higher than that money is generating.

For me I had £9k sat in an account earning 0.5%, and was financing at 5% plus. I chucked in the £9k based on £3k a year, even though its a 4 year PCP. I am unlikely to VT but might not keep the car to term. Alternatively, I might decide to keep it at 4 years. I may pay down the outstanding monthly payments and just owe the GFV in next few months. I may pay it all off. Who knows - but I did know that I was happy to chuck in the £9k to make monthly payments less...
If you know in advance that you're going to VT after 3 years, which I did, or even that you might, putting in a £9k deposit doesn't make sense even in your circumstances.

It absolutely does if you know you're going to full term and getting the benefit of all your deposit.

If not, and you end it after 3 years, you've thrown away £2,250, which is more than you've saved on interest charges over the first 3 years.
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      12-07-2018, 08:29 AM   #20
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It used to be a 3 year deal which was more sensible now they want a 4 year deal and you end up financing a car without a warranty which is piss poor and then they wonder why people VT.

You could end up with a 3.5 year old car that you still owe 17k on with a new engine bill for 10k it's madness from an underwriting POV. Thousands of cars driving around without warranties on new car finance that could become distressed debt and a potential write off.
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