[MEGA]

Hi Guys.

Excuse this topic. TMP posted something similar up and it's made me think to get some general input on my situation. See if what I'm planning is sensible or not? This is just a general musing kind of discussion. If you can't be bothered pandering to my flights of fancy then press back now

Still with me? So..

My car was purchased Jan 2009 on a 4 year PCP deal for £255 a month, 1k down. Purchase price £14,500. Baloon payment of £4,500.

My settlement figure now stands at approximilately 9k with 20 months remaining.

At the same time, my car seems to be depreciating at about £150 a month now, whereas initially I did far better. I'm seeing early 05 cars going for 9k. Mine being August 06 I'd want 10,500 for the car on 68k in good general condition. Excluding any modifications. PX if I was to let go of the car today I'd want anything with 5 figures.

What that means is every month I keep the car, assuming it doesn't hit any cliff and fall off in terms of future value: I'm further into positive equity.


In addition to the remaining 9k on the car, I have 6k in other various debt.

I am clearing approximately 600-700 a month of debt, which means by March next year I should be completely debt free [other than the car], and the car will then be worth 8.5k (with a settlement figure of approx 6.5k)

It therefore seems sensible to wait until said March deadline and then trade the car in (after restoring to standard), or sell privately - and pick up something for about 22k top end (400/mo on similar PCP deal?) giving me scope to actually save some money (or, build up 6-7k and knock a massive lump off the finance on whatever I buy).




Have I thought everything through? Can you think of a more logical way to zero the debt and also step into a nice car in the near future?

I've considered selling privately with all the current modifications and jumping straight into a new car but that just doesn't seem financially sensible. As I'll still not be debt free etc.

Lastly, I need someone to tell me that even though I *could* pick up an E92 M3 in crimson red on an 09 plate with DCT and individual audio, once I get to this "march next year" position: And still be comfortably in budget in terms of incoming/outgoing: That it is much more sensible to spend less and get some savings. This is probably not the forum to ask that question of though

[pjs]

Mega

When you write it out like that, the conclusions are pretty obvious. I don't think you've missed much.

The longer you stay in it, the better car you are more likely to comfortably afford next year. And next March, you can get your M3.

Forums like this rarely encourage long term ownership

[willhollin]

Get the M3 now.

You can't take it with you.

[Vaheed1]

Wait until you're debt free and then purchase the M3. From What I've heard, you'll need the free'd up cash from your debts to run it

[MEGA]

By the way: Are these kind of PCP calculations accurate? I used a pcp calc spreadsheet to calc them based on a PX of my car and getting 2k more from my car than it's outstanding finance.. Along with the dealer knocking 1k off the purchase price..


It kind of seems like the interest is far too low?
NB I chose the balloon payment value as 12k based on guarunteed future value being about 35%? Is it a fair number?


Base Price £ 27,995.00
Options £
Cash Price £ 27,995.00

Deposit £ 2,790.00
Dealer contribution £ 1,000.00
Part exchange value £ 2,000.00

Final Payment / GMFV £ 12,000.00

Credit amount £ 22,205.00

Interest rate 9.90

Term 48


Monthly payment £ 357.34

Total paid amount £ 28,794.76

[MEGA]

Originally Posted by Vaheed1

Wait until you're debt free and then purchase the M3. From What I've heard, you'll need the free'd up cash from your debts to run it

servicing costs will be on a par with the current car, but certainly the petrol costs will at least double (I get 27 mpg right now and expect to get 13-14 in the big M )

Talking about 140 a week then or an extra 70 a week to now. Not that bad. Just one meal with the missus per week less should it come down to it

[Hotcoupe]

Originally Posted by MEGA

servicing costs will be on a par with the current car, but certainly the petrol costs will at least double (I get 27 mpg right now and expect to get 13-14 in the big M )

Talking about 140 a week then or an extra 70 a week to now. Not that bad. Just one meal with the missus per week less should it come down to it

I think the M3 will cost a tad more on servicing, tyres etc than your 320D Dave, take the rose tinted glasses off

How about insurance costs, 320D to M3, quite a leap in groups, plus your age will have an impact.

Geez,I wish I had that problem

Will you be able to eat at all, never mind the OH!

Actually............. will you be able to afford the OH?

[willhollin]

Originally Posted by Hotcoupe

Actually............. will you be able to afford the OH?

Does Dave rent her?

[MEGA]

Originally Posted by Hotcoupe

I think the M3 will cost a tad more on servicing, tyres etc than your 320D Dave, take the rose tinted glasses off

How about insurance costs, 320D to M3, quite a leap in groups, plus your age will have an impact.

Geez,I wish I had that problem

Will you be able to eat at all, never mind the OH!

Actually............. will you be able to afford the OH?

You're forgetting that I've got the 320d with more issues than anyone else in the history of the world. 6 warranty claims, of which I pay an excess each time, and more services than that in 2 years plus a new clutch prop shaft oil sump and etc out of my own hard earned. And currently having to investigate issues with turbo pickup out of my own cash as bm refuse to investigate.

The m3 won't cost more to keep on the road, other than the fuel costs. Unless my luck is even worse with the new one!

Anyway. That's for then. The now is whether or not my plan for this car is the right one

Cheers

[MEGA]

And re: insurance: I'll turn 25 in sept which the comparison sites according to the current car suggest saves me about 40% so I'll be able to insure it for 2k ish. Hopefully

[Hotcoupe]

Originally Posted by MEGA

And currently having to investigate issues with turbo pickup out of my own cash as bm refuse to investigate.

The m3 won't cost more to keep on the road, other than the fuel costs. Unless my luck is even worse with the new one!

Anyway. That's for then. The now is whether or not my plan for this car is the right one

Cheers

Originally Posted by MEGA

Anyway. That's for then. The now is whether or not my plan for this car is the right one

Looking at the history of the car and the issue above Dave,I'd out the car ASAP.
I can understand the reasons behind trying to start afresh debt free next March,but what sort of car problems could you hit between now and then.

I don't need to tell you about all the problems associated with the 320D, specifically the turbo's, which based on your post above is already causing you concerns.

How much is your warranty (I assume you have a extended BMW one)?
I'm guessing at £50-60 pm so £600 - £700 per year, which by the sounds of things BMW are not being overly helpful with, will it get better or worse?

Will your hoped for equity in March 12 prove to be accurate?
If your in positive equity now, why not try and release it and put it into a good AUC car now.


It's a tough one, but your post tells quite a telling story in terms of your cars reliability, and I can't think more miles on it will improve things.

Food for thought?

[BGM]

can you upload the pcp calc workbook ?

[MEGA]

Originally Posted by BGM

can you upload the pcp calc workbook ?

Will do. On the iPhone right now.

[MEGA]

Interesting food for thought. If I was to sell early it would be September. I have to spend some time putting the car back to standard before I can sell her. Argh. Decisions decisions.

Originally Posted by Hotcoupe

Looking at the history of the car and the issue above Dave,I'd out the car ASAP.
I can understand the reasons behind trying to start afresh debt free next March,but what sort of car problems could you hit between now and then.

I don't need to tell you about all the problems associated with the 320D, specifically the turbo's, which based on your post above is already causing you concerns.

How much is your warranty (I assume you have a extended BMW one)?
I'm guessing at £50-60 pm so £600 - £700 per year, which by the sounds of things BMW are not being overly helpful with, will it get better or worse?

Will your hoped for equity in March 12 prove to be accurate?
If your in positive equity now, why not try and release it and put it into a good AUC car now.


It's a tough one, but your post tells quite a telling story in terms of your cars reliability, and I can't think more miles on it will improve things.

Food for thought?

[CarAbuser]

Captain boring here says zero the debt.

It's a nasty cycle to get into. Life's much less stressful when you don't owe anything.

[BIGTIME]

If you wait till next year won't the new 3 series be getting launched. You may want to wait for the new model.

[MEGA]

Originally Posted by BIGTIME

If you wait till next year won't the new 3 series be getting launched. You may want to wait for the new model.

New M3 will be 2013 at the earliest

[BIGTIME]

It's up to you mate, but if you change in 2012 you'll only have one year of having the 'current model M3'. To some this won't matter.

[MEGA]

The only reason it matters to me is the risk that E92 prices plummet when the F32 comes out. As such I need to maximise the finance cost in order to bring the interest/ baloon payments down if I'm going to go for it - so that I can get out at the appropriate time.

Then again, a good E46 is still 16k. The early ones are 10-12k. You could argue that at 26k or so, the M has had it's biggest depreciation hit and won't be too bad.

[Fox530]

Originally Posted by MEGA

The only reason it matters to me is the risk that E92 prices plummet when the F32 comes out.

Does this really happen though? I mean the new model is very desireable but people buying 3-4 year old E92's can't afford the new model anyway so I don't see how its sudden realise will plummet the price of the F32. The E60 didn't exactly plumet in March 2010.

What does plumet are the nearly new examples - a 2013 E92 will be worth a lot less at 18 months old than a 2010 is now because the choice becomes, at the high end pricepoints, 18 month old E92 or 12 month old F32...

But towards the bottom of the market? If you could afford and would therefore be tempted by the F32 you are probably not going to be looking at 3+ year old E92's in the first place.

[Ant Man]

I'd say pay off debt, build up your cash and buy your next car outright.

Given that the current M3 will be the last normally aspirated engine, I very much doubt prices will tumble when the new M3 comes out in 2013/2014.
It may even turn into a future classic.

Slightly off topic
Going from a 320d to an M3 is a big step and in some ways possibly less rewarding. You can bully the 320d everywhere and mash the accelerator. M3 doesn't start working until 50 / 60 mph and feels in the zone well into 3 figure speeds. What I'm trying to tell you is that it cannot be properly exploited on the road and you may find another car offers you a more rewarding overall driving experience for real world use.

[gangzoom]

Originally Posted by MEGA

The m3 won't cost more to keep on the road, other than the fuel costs.

I think you have to be more realistic regarding the running costs of a M3. There is no way a 400+ BHP V8 is going to have similar running cost compared to a 2L 4 cylinder diesel. On top of fuel costs, you need to add in insurance, road tax, tyres, brakes, clutch, CV joints etc...

As in regards to buying a car with borrowed money....it all depands are where you are with you life. I bought my Nissan 350Z when I was 25 on PCP, at the time I was single, didn't have a mortagage, and generally had no real responsibilities in life

4 years on, I've just got married, now have a nice £120K "loan" on my house for which i'm paying the bank £600 a month (£450 of which is interest) for the next 25 years , and probably going to have a family in the not to distant future.

I've been lucky, and was able to pay the Z off quite quickly...which left me plenty of disposable income to save up for a house deposit / new car etc.

Hopefully will be completling a deal on a 08 335i this weekend...no more borrowing money for me thank you Could have quite easily stretched my finances a bit and got into a 08 E90 M3, but i've got more important things to think about these days ...still will be a fitting a Quaife diff and Remap at Birds as soon as I get my hands on the 335i

But if I was still single and renting, I would have quite happly taken Nissian up on their latest PCP + servicing offer on the new GTR...no one can tell you what to do with your money, but I certainly wouldn't under estimate the up keep costs of a M car, theres a reason why used M5's can now be had for £20K