Downsizing....or..... Need Advice

[its_a_doozy]

OK, credit crunch time.

I am paying £500+ month on my IS250 SE, and now thinking of downsizing. As such Lexus dealership can't really come up with a deal which either means me walking away owning nothing, or trading in and reducing monthly payments.

The spec of my car is on my profile

My Lexus finance deal has a current balance of £17k, but the parkers guide for my car is much less. Turns out I was sold or should I say miss sold a 48month plan that appears not to have a guaranteed final buyback value, thus my balloon payment in Oct 09 would still be more than the value of the car.

Looking for options on how to rid myself of the debt without too much pain.

Lexus have suggested a new SE Auto, no SatNav with 42 month plan with guaranteed residual buyback, but I have to handover my car AND stump up £4k for the privilege.

It looks either way I am going to have to hand over £4k to either get rid now, or in 12 months or trade-in for another Lexus. As I said I am looking to reduce my payments, not continue for another 3 years of £500+/month, so the Lexus trade-in doesn't appeal.

Any suggestions on alternative I could be considering? One option may be to search for a different car manufacturer dealer who is willing to give trade-in and cash back if such a thing exists. Sorry just thinking out loud.

[Scarlet Pimpernell]

This is one of the problems with PCP's and why I have always avoided them. These things ultimately are in THEIR favour only

Example with realistic figures:

They say:

pay a small deposit (on a £30k car thats £5k - if you PEX a car for say £15k, you get a cheque back for £10k, and think it's great!)

pay monthly for 4 years - say £450 p/m as an example (it'll normally be +- £25 a month on that sort of purchase price/deposit)

Pay a balloon of £12k or more in some cases - if you can agree it hand the car back/minimum value

Ooh - don't do more than 10,000 miles a year

So over 48 months, you've paid :

£5000 dep, + £21600 payments, and you still owe them £12000. If you haven't spent the £10k you got back originally and earned some interest on it then it might help....but the car would have cost you almost £39k. If you have a deal where you hand it back, they have effectively taken it for £3k, though you have to add some interest to that figure.

That's what Lexus, Audi and BMW offered me (fugures were very close to my example for all 3). I told them where to stick it...their interest rates are totally uncompetitive for these types of deals...and only benefit business users where they can get up to 40% tax relief on what is effectively a lease. The other thing to note is that you seldom get a discount on the purchase price when you negotiate a PCP too, or a smaller one. That should be factored in too.

My advice would be stick it out if you can. You're gonna have to pay it no matter what. The longer you keep the Lexus now, the less it will depreciate relatively speaking over the next 2-4 years. As dazed says, if you buy another new car, you start all over again - and that's what they want and you don't want!!

If you have to change it, don't get another new one...go for an ex-demo/management car...shop around - even on the web....and haggle hard. They want your business - just look at what happened to Lheman Bro's...not many pople will buy a new car, so they will b hauling back production and trying to get to a stage where they build factory orders only. This means they have to sell any car in a pound or on a boat and currently available!!

[Parthiban]

I don't think it's ever beneficial to try and end a lease agreement in the middle, as the value of the asset is always worth quite a bit less than the balance on the loan...........

Car finance rates aren't always that bad, we were offered a rate of around 4% a few years ago, very similar to mortgage rates at the time which is incredible on such a short term loan.

Can you use the finance company that you're currently with to try and buy another make of car (cheaper) that may allow you to get out without too much financial pain? Sorry can't be more help, don't know too much about how this side of things works.

[Scarlet Pimpernell]

Parthiban - spot on - you can still get good interest rates - I got 4.2% flat fom BMW Financial Services...on a the lowest figure they loan - £8k. For BMW Select they wanted 9.9%, where I pay only £5k deposit and finance the rest on a PCP! They were taking the Pies!

[its_a_doozy]

My advice would be stick it out if you can. You're gonna have to pay it no matter what. The longer you keep the Lexus now, the less it will depreciate relatively speaking over the next 2-4 years. As dazed says, if you buy another new car, you start all over again - and that's what they want and you don't want!!

If you have to change it, don't get another new one...go for an ex-demo/management car...shop around - even on the web....and haggle hard. They want your business - just look at what happened to Lheman Bro's...not many pople will buy a new car, so they will b hauling back production and trying to get to a stage where they build factory orders only. This means they have to sell any car in a pound or on a boat and currently available!!

Thanks for the advice SP.

Not sure where my original post went and the valued replies. Have sent message to mods to try and find it.

I don't intend taking out another PCP. It worked out ok with me previous IS200 Sport, and that's why I stayed with Lexus for my new IS250. The problem was, to reach the figures I wanted to pay, they offered a 48 month deal. It only transpires now that they tell me they don't do these anymore, because is leaves buyers with a car for 4 years, and no guaranteed buyback/balloon. That was news to me, as at the time I was lead to believe it was the same deal type as the previous 3 year PCP deal....was I miss sold??? Going to go through the small print and might get in touch with Lexus directly.

I don't want or need a new car. I just wanted to reduce my monthly payments by at least £100/month. I have a car allowance with my job so in the grand scheme of things, I still have a subsidised car, and won't lose out in real terms.

Looks like I'll either have to bite the bullet and sell up and pay the £4k outstanding, and get a loan for a pre-registered, managers, or other 2nd user car which is £400/month or less. OR, keep the Lexus until Sept 09, and hope the outstanding is less than £4k, but I can only imagine it will be larger.

[Parthiban]

Parthiban - spot on - you can still get good interest rates - I got 4.2% flat fom BMW Financial Services...on a the lowest figure they loan - £8k. For BMW Select they wanted 9.9%, where I pay only £5k deposit and finance the rest on a PCP!

Did you get offered 4.2% now when you just switched cars? If so, that's incredible, shows how much they're struggling to sell...............

[Scarlet Pimpernell]

Parthiban - spot on - you can still get good interest rates - I got 4.2% flat fom BMW Financial Services...on a the lowest figure they loan - £8k. For BMW Select they wanted 9.9%, where I pay only £5k deposit and finance the rest on a PCP!

Did you get offered 4.2% now when you just switched cars? If so, that's incredible, shows how much they're struggling to sell...............

Yup... on HP only Lexus offered 5%, before I even haggled about it!

BMW have their own finance house (yeah, right) I was told, so could give any rate they wanted...they had been doing 3.99% on new and Ex Demo's until start of july! I reckon some dealerships intend to make money from finance so give you a higher rate...they must have an incentive, I'm sure.

If you can afford to, now is an excellent time to buy expensive things - cars, houses, Rolex's etc!

[its_a_doozy]

I don't think it's ever beneficial to try and end a lease agreement in the middle, as the value of the asset is always worth quite a bit less than the balance on the loan...........

P.S. Not sure if the mods thought you were trying to sell your car on here as a non-Gold member which is why the original thread disappeared

Thanks Parthiban.

As mentioned above my previous PCP went well. Looks like 4 year term is the issue. Not only does is apparently not guarantee a final price, but it also leave you with a car for 12 months without any warranty. Who would pay £500/month for a car that has no warranty ?? Me ...it turns out

[Parthiban]

Yup... on HP only Lexus offered 5%, before I even haggled about it!

BMW have their own finance house (yeah, right) I was told, so could give any rate they wanted...they had been doing 3.99% on new and Ex Demo's until start of july! I reckon some dealerships intend to make money from finance so give you a higher rate...they must have an incentive, I'm sure.

If you can afford to, now is an excellent time to buy expensive things - cars, houses, Rolex's etc!

That really is interesting, I'm not looking for a car at the mo (very happy with mine :) ) but it really is the right time, prices are low and finance is cheap! Houses are a different matter altogether as it's almost impossible to get finance unless you have a very solid income..........may get myself a Rolex though :P

Thanks Parthiban.

As mentioned above my previous PCP went well. Looks like 4 year term is the issue. Not only does is apparently not guarantee a final price, but it also leave you with a car for 12 months without any warranty. Who would pay £500/month for a car that has no warranty ?? Me ...it turns out

So you paid a deposit, then £500/month for 48 months, and then there is also a balloon payment at the end? That doesn't sound particularly cheap to me, does it at least include maintenance at that price? If you don't mind my asking how much was the deposit and how much will you need to pay at the end to settle the loan?

[its_a_doozy]

Hi people,

Just thought I'd share the news...

My downsizing exercise has not taken me away from Lexus. I'm here to stay for another 42 months.

Having attended a "manager special" day, I have wangled a PCP deal to rid me of my IS250 SE Manual +SatNav, for an IS250 SR Auto, no SatNav. Obviously a lesser spec of car, but ticked the boxes for lower monthly payments, and a guaranteed residual value at the end of the term.

Went for a black car this time. Don't know if I will regret forgoing the SatNav, Mark Levinson stereo and the fantastic reversing camera

Looking forward to owning an auto, as I have hated the manual gearbox for the last three years.

[Paradroid]

Good choice, I like the IS250SR and the auto is supposed to be better than the manual from what I've heard :)

[its_a_doozy]

The manual on my SE has always been clunky. In the early days, I got the "oh it will smoothen out after a few K miles". Never did, in fact I think its gotten worse over time.

The auto seems much better, and the fact that the Road Tax is cheaper is another bonus.

I do like the grey leather in my current IS, but these times call for some moneysavingexpert.com thinking.

[lexulator]

Auto is definitely better on this car. Personally I would have held out for an MM version though - I can't do without the reversing camera now!

[its_a_doozy]

Just had the Lexus Dealer on the phone saying its been hard to track down the car I want, and that they can get an IS250 SR, but without heated front seats. This would be £200 less than the one with.

Can this be right? Would it be a proper IS 250 SR or some bodge made up one from a dealer....ie a Base IS250 with body kit, wheels, and extra scuff plates, and pedals??

I initially have said that I want heated seats, as I am forgoing a lot of features such as leather and heated/cooled seats, so heated was a must.

Thoughts?

[Northern Boys Luv Gravy]

Just had the Lexus Dealer on the phone saying its been hard to track down the car I want, and that they can get an IS250 SR, but without heated front seats. This would be £200 less than the one with.

Can this be right? Would it be a proper IS 250 SR or some bodge made up one from a dealer....ie a Base IS250 with body kit, wheels, and extra scuff plates, and pedals??

I initially have said that I want heated seats, as I am forgoing a lot of features such as leather and heated/cooled seats, so heated was a must.

Thoughts?

That's interesting because at first I thought the IS250SRs were base models with a body kit and bigger wheels and were a way of selling off excess stock. Then I saw they had a different seat material to the base IS so assumed they were indeed a new model. I wouldn't be too bothered about heated cloth seats but check they haven't just tarted up a base model.

BTW you made the right choice with the auto, and despite some diesel owners suggesting it's not as fast as the IS220d, you drop it into sport and hold the revs using the paddles and the thing will absolutely fly. My favourite is holding it in 2nd round a roundabout and then flooring it as you come onto the dual carriageway - it really takes off.

[its_a_doozy]

BTW you made the right choice with the auto, and despite some diesel owners suggesting it's not as fast as the IS220d, you drop it into sport and hold the revs using the paddles and the thing will absolutely fly. My favourite is holding it in 2nd round a roundabout and then flooring it as you come onto the dual carriageway - it really takes off.

Well, hopefully I'll get to try that out for myself in a few weeks, if they can get me the car they promised...

I definitely don't want a botched base version pretending to be an SR...

[Parthiban]

I'm confused, if all SRs have heated seats (which I thought they did), how has your dealer got an SR without heated seats?

As far as I'm concerned, it does sound like they're trying to give you a base model with SR bits (and it's easy for them to get the 17" wheels as they probably have tons of them from those that upgrade the SE and SE-L wheels)

I don't think there's a real problem, but be aware you probably are getting a base model - can't imagine it having a huge effect but for insurance it would be a modified base model rather than a standard spec SR.............

[Scarlet Pimpernell]

The dealer is pulling yer leg - how can they find a standard production "SR" without the standard spec? Lexus don't have any individual options...so it's impossible to have one with heated seats and one without...it's not an option that could be missed!

If the SR has heated seats then it comes with heated seats. End of...else you offer them a lot less than £200!!

As for the 250 performance....I though it was sluggish overall, unless you stick in ECT and really thrash it's kahuna's off...keep the revs near the red line and it does shift well - but then so it should...it has over 200 BHP - but you can only really feel them horses after 4200 RPM and stretching your right foot...typically VVti!!

PS - from the Lexus website:

THE IS 250 SR

IT'S ALL IN THE DETAIL

Note the understated sculpting of the rear spoiler and the deep front skirts. The powerful stance: low, confident and poised.

Inside, subtly luxurious details slowly reveal themselves: heated front seats, leather steering wheel, LED interior illumination and responsive climate control. At your feet, the aluminium sports pedals connect luxury to performance. The 2.5-litre V6 petrol engine starts at the touch of a button. Its sublime bass note gently underscores its dynamic nature.

Naturally this refined combination of power and styling comes at a price. A surprisingly low one. The subtlest details speak the loudest: the IS 250 SR, just £25,040 on the road.

It sounds like a Base plus some after kit (wheels, body and pedals). I'd offer them £1000 off any deal you've got...sounds like they're shifting something a bit sus....this is why I hate dealers with a passion!

[shytalkz]

...sounds like a Base plus some after kit...

It would be an interesting check on the V5, if that's what they were doing!

[spikes]

Just had the Lexus Dealer on the phone saying its been hard to track down the car I want, and that they can get an IS250 SR, but without heated front seats. This would be £200 less than the one with.

Can this be right? Would it be a proper IS 250 SR or some bodge made up one from a dealer....ie a Base IS250 with body kit, wheels, and extra scuff plates, and pedals??

I initially have said that I want heated seats, as I am forgoing a lot of features such as leather and heated/cooled seats, so heated was a must.

Thoughts?

stick it out for the heated seats :) you'll always be thinking is it or isnt it a real SR

[fairygodmother]

Just had the Lexus Dealer on the phone saying its been hard to track down the car I want, and that they can get an IS250 SR, but without heated front seats. This would be £200 less than the one with.

Can this be right? Would it be a proper IS 250 SR or some bodge made up one from a dealer....ie a Base IS250 with body kit, wheels, and extra scuff plates, and pedals??

I initially have said that I want heated seats, as I am forgoing a lot of features such as leather and heated/cooled seats, so heated was a must.

Thoughts?

stick it out for the heated seats :) you'll always be thinking is it or isnt it a real SR

You now can order the SR model without heated seats providing you do not want the multimedia pack. A bulletin was sent out to the dealer network on 16th October. Model code 1ZB for Automatic and 11D for manual cars. :winky:

[its_a_doozy]

Thanks for the comments. I hung out for the heated seats, and they have now found one. Due in a few weeks, have just been sent the new 58 plate number for insurance purposes.

Another query... I have private plates on my current IS250 and want the dealer to manage the transfer. What charges would you expect to pay for such a transfer? They have insisted on registering with a 58 plate, and do the transfer a short while after...

[Parthiban]

Glad it's sorted. Regarding the personal plate, personally would have taken the plate off in advance, it saves time and hassle. When are you picking up the new car? I'm guessing they want it done by the end of the month (hence the 58 plate) in which case there probably isn't enough time.

I think it's £80 to transfer a reg btw

[its_a_doozy]

They have said car will be ready in a couple of weeks max. Expecting an ETA to be given shortly. £120 was mentioned for the transfer of the plates, all dealt with by dealer with no need for me to bob down the DVLA and go through all that nonsense.

[Tel]

The transfer fee is £80 & mine was part of the Deal.The transfer took 3 weeks though because the DVLA has just brought in a new system!

Tel