OPTION 1 BUY NEW ON PCP
Most dealers offer PCP schemes through one or two big finance houses – this is how it works...
O Get your budget worked out, based on what you can afford as a deposit and as monthly repayments for the duration of the contract
O You can get PCP on any amount from £1500 upwards
O Choose your new motorcycle (or a used one, as bikes up to three years old can also qualify – see right)
O Set a repayment term of between two to four years
O Set your annual mileage at up to 24,000 miles a year. Your annual mileage will affect your monthly payments and future value. Most deals are based on 4000-6000 miles
O Decide on which end-of-agreement option is best for you when the time comes – most roll on to another bike
This option’s great if...
O Not owning the bike outright doesn’t bother you
O You like to keep your options open
O You’re after flexible deposit options
O You can work with a mileage allowance of up to 24,000 miles a year (more will incur penalties)
O You want to pay over a period of two to four years in regular, relatively small, monthly payments
O You want to pay equal monthly payments across the term
O You are worried about an unexpected fall in the value of the bike (thanks to the ‘G’ in Guaranteed Future Value)
At the end of the contract...
When your contract comes to an end you have three options:
O Part-exchange the motorcycle for another one – subject to settlement of your existing finance agreement
O Return the motorcycle. If it’s in good condition and has not exceeded the allowed mileage you will have nothing further to pay
O Hand over the final payment figure and can keep the bike
Be aware that...
O You do not own the motorcycle and won’t unless you pay the final balloon figure at the end of the term
O A significant proportion of the credit is deferred until the end of the contract, and it’s not the cheapest route to actual ownership
O You must have fully comprehensive insurance cover in place throughout
O Excess mileage charges apply, and some are quite hefty
O Abuse or neglect will damage your bike’s guaranteed future value
O Your motorcycle is at risk of repossession if you do not maintain contractual repayments.