Car finance: Top 10 PCP myths busted

Car finance: Top 10 PCP myths busted 

https://www.thecarexpert.co.uk/car-finance-top-10-pcp-myths-busted/4/ 

PCP Myth #9: There’s no risk because of the GFV

If you need or want to change the car before your PCP ends, any negative equity is your problem, not the finance company’s (see Myth #6) because you can’t claim the guaranteed value until the end of the agreement.

If your financial circumstances change during the course of the agreement for any reason, you still have a large debt that needs to be paid off.

If you lose your job, get sick, have unexpected legal costs or anything else pops up that stops you from paying your monthly PCP bill, you will eventually find yourself in trouble and the finance company will be looking to reclaim every penny you owe – regardless of what your car is worth.

You will probably end up in a voluntary surrender position (as we discussed in Myth #5) and be doorstepped by collections agents before long.

Also, as we outlined all the way back in Myth #2, PCPs are usually sold on the promise of equity at the end. If the value of the car drops below what’s expected, your expected equity goes out the window before the finance company starts losing anything.

As we all found out during the credit crisis of a decade ago, normal borrowers lose their shirts well before the bank starts to suffer. Even if they do lose, you will have already lost too.