‘I READ UP AND WENT IN WITH MY EYES OPEN’
LAURA Erskine purchased a seven-seater Skoda Kodiaq two months ago through a Personal Contract Purchase, more commonly known as a PCP.
She was forced into buying a new car after the engine went in her second-hand car. It came at a difficult time as she bought a house last December with a ‘hefty mortgage’.
Ms Erskine, who is head of community with parenting website MummyPages.ie, found that banks and credit unions would not give her the full amount for the new car.
‘I had heard that there was a lack of understanding around PCP so I educated myself in advance of going to meet them to make sure that I fully understood it,’ she said.
She opted for the PCP because repayments were less per month than a loan, adding that she intends to save up money every month in order to cover the balloon payment due at the end of the contract term.
Ms Erskine said that the car dealership explained the process thoroughly and she never felt pressurised to go through with it.
‘I actually found the whole process really easy and they took the time with me to go through everything in detail. I never felt rushed, I never felt compromised, I never felt pushed into anything,’ Ms Erskine said.
The car cost a total of €35,000. She was asked for €3,500 up front and she has to pay €625 a month for the next three years. At the end of the contract she will be obliged to pay €13,000 as a final balloon payment.
‘I think everybody should understand what they are buying in the same way that there was this big ad campaign over what is a tracker mortgage,’ Ms Erskine said. ‘If you are taking on a big financial commitment, I think you should go in with your eyes open.’