Financing

[BudJar]

Hi Guys,

Have read all the posts here with interest, and after a few weeks of Toyota Prius Reviews surfing all over the net, thought it about time I registered and started posting here. In the hope some of you may be able to help me out with a couple of things.

3 weeks ago I put down my deposit of £500 and ordered a the Prius T4 spirit, however, as I understand, it will be at least another 6 to 7 weeks before the car is available. I don't mind waiting as I'm really excited about the prospect of owning one. I'm absolutely convinced by this car and all it has to offer, this is after reading every possible review under the Sun which all confirm how great it is in terms of fuel consumption, popular acceptance, tax breaks, congestion charge break, style, speed, quietness and best of all, the technology of it all. Being a gadget man I can't wait to try it all out.

At present I have a Vauxhall Vectra LS 2.0 diesel, which is fine and everything, specially like the cruise control, auto windscreen wipers and rear view mirror dimmer, but I would like to have a car that would eventually be mine and do away with the hefty tax penalty I'm paying for it. At present the benefit on my tax code is 5500, so if i opted for my company's car allowance £320 per month, I would save approx £2000 a year in tax, but will have to fork out for servicing, car tax and insurance. The saving would still be big tho I reckon.

The Toyota salesman convince me that PCP was the best option and was the method on which he based his calculation of my monthly payments over the next 3 years. At the end of it all it appears that I would be paying a lump sum of £5,000 plus any mileage overrun (based on 20k pa). monthly payments are approximately £550 p/m. Now then, I'm not totally convinced and am wondering if there is any other option. I could afford to put down a larger deposit and perhaps borrow the money from elsewhere. Do Toyota have 0% finance on something like this or should I adopt a different payment plan ?

Ultimately I want to end up owning the car and selling on myself and mostly paid for by my company, rather than just a hiring arrangement whereby I'm paying shed loads per month and having nothing to show for it.

Am confused, please help !

Best regards

[SilverT4]

I am always a bit wary of dealers finance deals. I tend to feel I am being ripped off. Shop around before you decide, and compare the deals. Some banks e.g Alliance and Leicester do car purchase loans similar to dealers i.e low payments over 3 years and then a final balance to pay. Advantage is a much lower APR and a better freedom of choice after three years.

By the way .... Having had my Prius for two weeks now, I am over the moon with it. However my local filling station are really missing me!

[SilverT4]

Forgot to mention .... push your dealer for a delivery date for your TSpirit. I wanted one, and was initialy told it would be about four weeks, but then another dealer after some persuasion advised me that the Tspirit would not be available in the UK until May. In the end I decided on a T4.

[wise1]

Ref Toyota Finance - although I've just gone and bought a Corolla, so the deals are probably different.

But anyway I managed to get 3 years 0% finance on £5K (min Toyota would finance).

It all depends on the deal and what margin the dealer has. With a Corolla they have some degree of leeway - probably as its older. With a Prius, given its availablilty and the fact it is just launched, probably means no deals.

However if you don't ask, you don't get. Tell the dealer you are going to finance it with XYZ bank and the rate is XYZ%APR - you never though they may match it or try to get nearer to it. Remember the dealer gets paid for doing the finance with Toyota.... <_<

[BudJar]

Silver,

Thanks for the advice... I will certainly enquire. Especially the A&L angle, as I have a good history with them and am about to redeem mortgage ! should have some good credit points (hopes).

Glad to hear that you have nothing bad to report re your T4, it's encouraging. Will be pushing my Toyota dealer as soon as I think. They had originally promised the end of March/Beginning of April.

The wait gives me plenty of time to shop around for the finance too.

BudJar

[Braindead]

You won't be sorry you ordered a Prius...I'm still grinning after 2 weeks of driving my T4! :D

Anyway, finance!

I used to have a company car which cost me over £250pm in tax. I changed to the allowance type scheme. The allowance is taxed as salary so if you get, say, £400pm gross that will be £240 per month after 40% tax. So, you have saved £250 in company car tax plus gained £240 in allowances so you have about £490 at your disposal to cover car, servicing, road tax and insurance.

Assume £5 road tax, £25 insurance, £20 servicing = £50 per month so that leaves £440 for the car.

I went through getting quotes for PCP on a Prius and I suggest you give up now!

I got a quote on 18k miles per year over 3 years. The residual value (the guarrenteed value of the car) at the end of that was only £4,200!!!! :( Theat tells me that the industry is not sure about Hybrids and their ability to hold value.

If you put in a £5,000 deposit, that means you have to finance £19,200 - £5,000 - £4,200 which is about £10,000

Toyota quoted me an APR of 16.9 which is robbery! You can get a PCP product from Sainsburys at 7.9%. Show that to the dealer and he will match it.

The big advantage of PCP is that it is an HP agreement so you can give the car back after you have paid over half the total amount payable - just done that with my Nissan when I bought the Prius. Down side is yo pay a fairly high APR.

The best way I could find to buy a Prius was to get a personal loan. I think Cahoot do the best deal at the minute at around 5.9%APR. Failing that Tesco seem quite good. They all have online quote calculators. My dealer told me they might have been able to get a better loan (not HP) after I'd taken one out so ake a quote with you and see if you can get a deal.

I took out a 5 year loan but will probably clear the loan after 3 years - to buy a new Prius.

The Alliance and Leicester car loan is not PCP. All they are doing is selling you a personal loan that should take about 5.5years to pay off but the quote it for three years plus a final lump sum. When you get to the end they offer you the option to keep paying the payments till the loan is cleared rather than pay the lump sum. As it is not HP you can't pull the stunt of returning the car after paying half the total amount owed.

The word is that they loose money on every Prius they sell but sell them to get the market moving......just try getting a discount!

Good luck!