[ByTheSea]

Originally Posted by ZeroFx

"For example, when looking for a loan or mortgage, you are likely to choose a lender that offers the lowest rate. Although the quoted rates appear low, you could end up paying more for a loan than you originally anticipated.

This is because banks will often quote you the annual percentage rate (APR) on the loan. But, as we've already said, this figure does not take into account any intra-year compounding either semi-annual (every six months), quarterly (every three months), or monthly (12 times per year) compounding of the loan. The APR is simply the periodic rate of interest multiplied by the number of periods in the year. This may be a little confusing at first, so let's look at an example to solidify the concept:

As you can see, even though a bank may have quoted you a rate of 5%, 7%, or 9% depending on the frequency of compounding (this may differ depending on the bank, state, country, etc.), you could actually pay a much higher rate. If a bank quotes an APR of 9%, the figure isn't taking into account the effects of compounding"

You are having your pants taken down by car salesmen which lets be honest is frankly quite embarrassing.

Correct. When I purchased my car I was offered APR 6.4% by BMW, 3.4% by my bank and 2.8% by John Lewis Finance. When I looked at the monthly payments on those not unexpectedly the bank was cheaper than BMW, but also cheaper than John Lewis by around £20. Hidden charges a friend in the business told me.

[MashinBenzin]

Originally Posted by ZeroFx

You are having your pants taken down by car salesmen which lets be honest is frankly quite embarrassing.

Who is? You are assuming that everyone finds the maths as difficult as you do. Voodoo ffs, about something with only a few simple elements to grasp.

Some people might actually understand some or all of maths, business, finance, investment risk/reward and the importance of financial flexibility. Then choose to do their research and make their decision based on that.

The only one who needs to be embarrassed is some tool who is proud of mouthing off in a dealership and then being utterly unable to accept that different people have differing circumstances and points of view when it comes to a reasonably significant purchase.

I am done with responding to your inane and childish rantings - apologies to the rest of the forum for cluttering it and to the OP for derailing his thread by drawing your swivel-eyed attention to it in an ill-judged attempt at humour.

[ZeroFx]

Originally Posted by ByTheSea

Correct. When I purchased my car I was offered APR 6.4% by BMW, 3.4% by my bank and 2.8% by John Lewis Finance. When I looked at the monthly payments on those not unexpectedly the bank was cheaper than BMW, but also cheaper than John Lewis by around £20. Hidden charges a friend in the business told me.

APR doesnt have any other charges in the rate so its a useless metric other than for passive comparison.

Its a wonder product for car dealers. So complicated nobody understands them. Full of hidden costs and charges at the end of the agreement. They know most people havent got a pot to piss in so cant pay off the balloon payment and they are already being lured in to the next car before they even get out of the current one.

[ZeroFx]

Originally Posted by MashinBenzin

Who is? You are assuming that everyone finds the maths as difficult as you do. Voodoo ffs, about something with only a few simple elements to grasp.

Some people might actually understand some or all of maths, business, finance, investment risk/reward and the importance of financial flexibility. Then choose to do their research and make their decision based on that.

The only one who needs to be embarrassed is some tool who is proud of mouthing off in a dealership and then being utterly unable to accept that different people have differing circumstances and points of view when it comes to a reasonably significant purchase.

I am done with responding to your inane and childish rantings - apologies to the rest of the forum for cluttering it and to the OP for derailing his thread by drawing your swivel-eyed attention to it in an ill-judged attempt at humour.

Tell me.. did you move from your E90 to the current F36 you have now?

[Randolph13]

Let me explain
My current deal on the 335d is up next June when I will not wish to purchase but the car is in VT. I doubt I will be able to afford the new 3 series next year, although that is an assumption. So what I wanted was a car of similar spec at a similar monthly cost, low deposit but petrol rather than diesel and that is what I got. Also I doubt I’ll do more than 6k mikes/month so 8k is fine.

[Chompers]

Originally Posted by ZeroFx

APR doesnt have any other charges in the rate so its a useless metric other than for passive comparison.

Its a wonder product for car dealers. So complicated nobody understands them. Full of hidden costs and charges at the end of the agreement. They know most people havent got a pot to piss in so cant pay off the balloon payment and they are already being lured in to the next car before they even get out of the current one.

The only cost on a BMW FS deal is £1 'option to purchase fee' What are the hidden costs you refer to

[ByTheSea]

Originally Posted by Chompers

The only cost on a BMW FS deal is £1 'option to purchase fee' What are the hidden costs you refer to

The discussion was centering on APR% and making the very real point that APR% does not properly reflect what you actually pay in interest, there are hidden costs in the loan interest. The only real measure is what you pay per month.

[MashinBenzin]

Originally Posted by ByTheSea

The discussion was centering on APR% and making the very real point that APR% does not properly reflect what you actually pay in interest, there are hidden costs in the loan interest. The only real measure is what you pay per month.

What hidden costs? Yes, there are costs, but where is the hiding? There is a line that says 'interest payable'. Honestly, if people can't understand a clear BMW FS (and other manufacturers) proposition...

[ByTheSea]

Originally Posted by MashinBenzin

...where is the hiding?...

Hiding behind what appears to be a low APR. So for example John Lewis Finance quoting 2.8% and yet more expensive in monthly payments than the bank at 3.4%. So focus on monthly payments, not APR. I don't know how I can make it any simpler for you.

[ZeroFx]

Originally Posted by MashinBenzin

What hidden costs? Yes, there are costs, but where is the hiding? There is a line that says 'interest payable'. Honestly, if people can't understand a clear BMW FS (and other manufacturers) proposition...

You are paying £60 an hour to drive round in a 4 series and have committed £43,200 (not including finance costs) over the next 4 years with barely enough miles to cover the average commute let alone to have some fun in it.

I dont think understanding financials is your strong point.

[MashinBenzin]

Originally Posted by ByTheSea

Hiding behind what appears to be a low APR. So for example John Lewis Finance quoting 2.8% and yet more expensive in monthly payments than the bank at 3.4%. So focus on monthly payments, not APR. I don't know how I can make it any simpler for you.

You don't need to make it simpler for me, maybe for zero . I would compare monthly payments and total payable. I still see no hidden charge -it would be there in both those numbers. Don't rely on APR - I agree. That doesn't make it a hidden charge.

[JNW1]

Originally Posted by ZeroFx

You are paying £60 an hour to drive round in a 4 series and have committed £43,200 (not including finance costs) over the next 4 years with barely enough miles to cover the average commute let alone to have some fun in it.

I dont think understanding financials is your strong point.

But surely whether the cost of running a 4-series (or indeed any other car) is sensible is a judgement each individual has to make? What might seem expensive and insane to you may represent something which is easily affordable and worthwhile to someone else; that doesn't make either of you right or wrong, you just have different opinions and priorities.

The only time I'd agree spending money on a car isn't sensible is when you can't actually afford it; however, affordability doesn't seem to be in question here and ultimately how someone spends their hard-earned is surely up to them?

[ByTheSea]

Originally Posted by MashinBenzin

You don't need to make it simpler for me, maybe for zero . I would compare monthly payments and total payable. I still see no hidden charge -it would be there in both those numbers. Don't rely on APR - I agree. That doesn't make it a hidden charge.

I think we are in agreement as to what factors to focus on. You just don't seem to understand that APR is not a true measure of monthly cost. If one interest rate costs more per month than another interest rate which is a higher percentage it follows without doubt that the provider has incorporated other hidden charges which they are not making clear and some people, focusing only on the APR, will be taken for a ride. If you find that difficult then I don't have the energy to further explain what is a very simply concept.

[MashinBenzin]

Originally Posted by ByTheSea

I think we are in agreement as to what factors to focus on. You just don't seem to understand that APR is not a true measure of monthly cost. If one interest rate costs more per month than another interest rate which is a higher percentage it follows without doubt that the provider has incorporated other hidden charges which they are not making clear and some people, focusing only on the APR, will be taken for a ride. If you find that difficult then I don't have the energy to further explain what is a very simply concept.

I do agree, don't focus on APR is right. To be clear, every number in the agreement is important, every purchaser should read and seek to understand them all. I don't believe there are hidden numbers, but I think that's what you are saying too - obscure might be the better word. Especially for those who struggle with numbers/financials.

[MashinBenzin]

Originally Posted by ZeroFx

You are paying £60 an hour to drive round in a 4 series and have committed £43,200 (not including finance costs) over the next 4 years with barely enough miles to cover the average commute let alone to have some fun in it.

I dont think understanding financials is your strong point.

You've just concluded that I am paying about £450 per week/£ 23400 per year. Interesting number.

Also you have come up with a 4 year number when I have a 3 year PCP and will likely keep the car for several more years. And then you created another fictional number.

I'd suggest you spend a few quid on a new calculator, book some kind of maths course (GCSE is the traditional starting point) and then go for a lie down.

I know I have fallen for replying again, but your posts are truly astonishing.

[ZeroFx]

Originally Posted by MashinBenzin

You've just concluded that I am paying about £450 per week/£ 23400 per year. Interesting number.

Also you have come up with a 4 year number when I have a 3 year PCP and will likely keep the car for several more years. And then you created another fictional number.

I'd suggest you spend a few quid on a new calculator, book some kind of maths course (GCSE is the traditional starting point) and then go for a lie down.

I know I have fallen for replying again, but your posts are truly astonishing.

It was based on the 8k a year PCP which people often go for.

If you went for a PCP on a car you are going to keep past the 3 year term then that makes even less sense.

Gotta keep them payments low though ay!!! Fake it till you make it!!!!

[MashinBenzin]

Originally Posted by ZeroFx

It was based on the 8k a year PCP which people often go for.

If you went for a PCP on a car you are going to keep past the 3 year term then that makes even less sense.

Gotta keep them payments low though ay!!! Fake it till you make it!!!!

It was based on nothing, I do less than 8kpa. Your numbers were simply fantasy.

Makes even less sense to you with your primary school grasp of making money work for you. I'll carry on taking the cheap and free cars, thank you.

[ZeroFx]

Originally Posted by MashinBenzin

It was based on nothing, I do less than 8kpa. Your numbers were simply fantasy.

Makes even less sense to you with your primary school grasp of making money work for you. I'll carry on taking the cheap and free cars, thank you.

So it costs even more than £60 per hour to drive.

Its not hard to do the maths.

My primary school maths allowed me to buy my car in cash. You my friend are in debt to your eye balls.

[MashinBenzin]

Originally Posted by ZeroFx

So it costs even more than £60 per hour to drive.

Its not hard to do the maths.

My primary school maths allowed me to buy my car in cash. You my friend are in debt to your eye balls.

I give up, you are absolutely mental.

[ossi1]

Originally Posted by MashinBenzin

I'll carry on taking the cheap and free cars, thank you.

Can you explain cheap and free ?

[rich100]

Originally Posted by ZeroFx

So it costs even more than £60 per hour to drive.

Its not hard to do the maths.

My primary school maths allowed me to buy my car in cash. You my friend are in debt to your eye balls.

From what I've read so far I don't understand how you conclude that he is "in debt up to his eyeballs"? Perhaps I've missed something.

His net worth may for all we know far exceed that borrowed on the PCP if you were to offset funds invested against the pcp balance. As we discussed on the other thread, sometimes (admittedly not always) it makes sense to remain invested and either lease or borrow to fund a depreciating asset rather than cash out that investment.

As has been said is it not a case of each to their own?

[ZeroFx]

Originally Posted by MashinBenzin

Sure, I did explain in another thread the other day to zero, hence not detailing it again here. Long post but the only way to properly explain.

My first pcp, the lump sum that I chose not to put into the car grew by far more than the cost of the car. Such that i was able to clear the pcp very early just from the growth. I don't really see it that way, but man maths could call that car free. The original lump went towards a house move.

Subsequent PCPs have been cheap - one (the car that I bought for my wife) was 0%, but still had a 25% discount and retained almost 50% of list almost five years later. Again growth on the original lump went towards another house move.

My current pcp is 'cheap' as again the investments have considerably exceeded the cost of the finance. I put a large deposit in though as I wanted to keep the interest number sensible.

In between was my E90, good discount, high finance rate and probably no better than break even growth. However, again the lump sum was best not tied up as it went on the deposit of our current home.

I value both the opportunity to use money profitably and the flexibility on where to place money that pcp gives. Buying outright loses both and HP gives relatively too high a monthly commitment, more than I am comfortable with.

Note that nowhere have I said 'no risk'. Every one of these could have ended up less successfully, but the investment decisions I have made have turned out ok. I've also de-risked as I have got older as each car has been a smaller percentage of income.

The last piece of de-risking is ensuring that we pay off one car before buying another. We either own both outright, or one out of the two, depending on the point in time.

Ah the magical investments that yield huge returns. Made you so much money you drove a E90 320d SE for 7 years.

The 25% discount on a car that holds 50% of its value 5 years later.

HP that has "too high a monthly commitment" whilst ignoring the massive negative equity that you are in on a PCP as soon as you leave the forecourt.

Some how the lump sum value of a car can grow enough to pay for the car itself in a short period. Was this investment a kilo of coke because i dont see many investments producing the returns you seem to claim.

You spent the lump sum twice on house purchases. But apparently its back and invested whilst you PCP the 440i..

So you are a stock market master who sells his investments to buy houses, dodges the financial crisis and ignores the massive depreciation on buying brand new cars. But makes so much money he drives a e90 320d SE for 7 years?

I call BS on the lot.

Your lump sums are not substantial enough to make these fictional returns. Your time in the market is so short that they wont compound up that much in such a short time. If you were that good at picking investments you wouldnt be driving a e90 for 7 years.

No sane person sells an investment to buy a house (especially given your claimed returns). Unless its your only source of cash deposit.

Does. Not. Make. Any. Sense.