[1 AJC]

According to the salesman at my local dealership, 95% of the customers finance their car through MINI select. Is this really the case? what are the real benefits of it? I was initially planning to buy outright, but the salesman tried pretty hard to sway me from this, noting that the money would be better off earning interest in a bank. Quite true, but surely the fact that the cost for the finance will be far more substantial is more offputting.

[sef]

If you can afford it, pay for it out right... At the end of the day he is only thinking of his bonus for getting someone else signed up to finance.

[neilobe]

Pay for it outright mate, or if you do need a loan take it from an independent or get the dealer to match there rate if possiable.
Youll pay more for the car on mini select, the only benefit is to the salesmans monthly wage

[MINI&MERCGUY]

I worked out that the MINI Select package is the most expensive of all the options of buying/financing your MINI, including taking out a standard loan! The best option is to pay for it outright!

[Humph]

I have MINI select for various reasons, and it will suit some and not others. I don't want the hassle of selling a young car with very high mileage, so will just hand my Cooper back. As stated above it is an expensive way of buying a car if you intend to pay the final baloon payment. If you don't then there are a number of advantages to select, but really it is a scheme for people who want a new car for a small(er) monthly payment. It is only of any use or benefit if you intend on changing your car every two years or so, and your dealer will encourage this. If you were going to buy the car outright then I would do that & steer clear of select. The APR on select is in the region of 11% I think, but the dealer will encourage you to think of it as 5.5% flat rate.

[Tunster]

Paying outright isn't always an options for everyone. I for one don't have £21,500 to spend to purchase it outright! However, doing an options deal gives me the ability to purchase a car I really want, but to fit within my finances. I know I won't be possibly keeping the car in 3 years (at the end of the deal), I can ditch it or trade it in which is the most likely thing.

Some people are saying here it's cheaper to get an independant loan. However, I've had to limit myself to the Options deal as I cannot pay anymore than £300/month within my finances. I could go to £400/£500 a month, but for me, it would get uncomfortable.

For young people who aren't on £30k+ salaries or are starting out on credit based financed schemes, it's the best way to do it. For me anyway .

[1 AJC]

True, and I accept your point that one of the benefits of this option is that you can be on the road in an expensive car for relatively low outgoings each month. But surely (and please dont take this the wrong way) someone driving a £20k car on a low salary is living beyond their means?

The other attraction is obviously the ability to trade in for a new model every three years and having the security (or you would hope!) of a well maintained car. However, again looking at this in the long run, with a small deposit you are looking at nearly 13k to keep the car for three years in its first term (i.e. before it is traded) with nothing to show for it at the end!

[Tunster]

Quote: Originally Posted by 1 AJC (original)

True, and I accept your point that one of the benefits of this option is that you can be on the road in an expensive car for relatively low outgoings each month. But surely (and please dont take this the wrong way) someone driving a £20k car on a low salary is living beyond their means?

The other attraction is obviously the ability to trade in for a new model every three years and having the security (or you would hope!) of a well maintained car. However, again looking at this in the long run, with a small deposit you are looking at nearly 13k to keep the car for three years in its first term (i.e. before it is traded) with nothing to show for it at the end!

I'm not exactly stretching my finances to get it. For me at 21 (no mortgage, no bills to pay etc), I'd regret not getting a new and car I've wanted. However, I am planning my future and hopefully in 3 years time, I will have saved money on a house deposit etc and will most probably part exchange the car for another MINI at the end of the deal.

I'm going to enjoy it while I can so I don't have to regret not getting a sporty car earlier.

[colink24]

I agree with the fact that Select is a good option if you are looking at handing the car back within the finance period. Myself and partner earn a very good combined salary and could comfortably afford to buy the car without taking out Select but we are only planning onkeeping it for 2 years, we do not want the car outright as we would then have the hassle of having to sell it in 2 years time, or trade it back in and possibly not getting the deal we want

It may be the most expensive way of buying a car but it fits in with what a lot of people want in terms of payments etc - just try and get a rate under 10% if poss

[Jorge_A]

well i am buying my first mini soon and i will be doing the mini select plan...the thing most people dont realize is that with the ballon payment one can refinance it at a lower rate...like 4%...that brings down the cost of the car to about normal numbers....It is great for keeping your payments low throughout the buy....at first due to the high interest rate and later because u are only financing 66% of the car cost at a much lower rate...its a great option for first time buyers who just graduated from college

[minimeminime]

Forgive me for asking silly questions. Lets say I am putting £1,000 pounds down on a £12,500 mini.. I want to keep it for 2 years max.. Using the select finance plan what could I expect my monthly payments to be and what happens at the end of the 2 years?

[Mejy Poo]

Quote: Originally Posted by minimeminime (original)

Forgive me for asking silly questions. Lets say I am putting £1,000 pounds down on a £12,500 mini.. I want to keep it for 2 years max.. Using the select finance plan what could I expect my monthly payments to be and what happens at the end of the 2 years?

Don't qoute me on this but it would be something along the lines of....

24 payments of about £150 a month

Then a lump sump of about £6-7K at the end

I haven't got a calculator in front of me and I don't know exact rates or anything but I reckon it would like that - if you didn't pay that lump sum at the end you would give the car back.

I haven't gone for Select as I don't see an option where you tend to end up paying more in the long run as beneficial. It's like paying rent on something when you can buy it. Although I do appreciate it works for some people.

[I love MINI, Laura]

I went for MINI select as it was cheaper on affordability instead of overall. I'm fine with that as at the mo we need the extra cash for our wedding so it was cheaper on monthly payments. We will probably buy the car after the 3 years but at the mo its best for us this way.

[bigpoppa81]

im thinking about going down the mini select route, i have a car that is all paid for that is work 3500 and im thinking about putting that all in as a deposit? I know it would be more wise to sell it and use the money towards it but i just cant be chewed on with all the hassel. If i done this would this bring the payments right down on a car worth say 12k? i would be taking it over 2/3 years also and im hoping this would being the payments right down using such a larger deposit? would this happen?

also whats the situation with mods on the car as in if i got a set of r90 wheels on it an dobviously changed them back to the ones i got with the car when i handed it back? is this allowed?

[I love MINI, Laura]

Big poppa81,

Mini finance accept any MINI accessories on the MINIs they accept back. So you don't have to take them off as such you can sell it or trade it back in to them with them on if you like.

The mileage limit etc on MINI Select, only applies if you hand the car back to settle the finance only and walk away, not if you sell the car back to them, trade it in for another or pay the final balloon payment so you can do what you like with it really. Shawn and I knew we would never be handing the MINI back to MINI to finalise the finance and walk away, we would either get another (trade it in), sell it and pay off the finance or pay off the final balloon payment so the final mileage etc wouldn't apply. So we used the system to our advantage and took the smallest mileage out (6000 a year) as this dropped the monthly payments slightly but raised the final payment slightly. Better for us in the affordability states.

[bigpoppa81]

laura can i ask you what kinda deal you got on your mini and how much your paying per month please?

thanks

[I love MINI, Laura]

£2000 deposit, £251 a month for 4 years and a appox £7000 final payment. Car was £17290 for second hand 56 reg S in August. Overall it works out at £21000 which is scary but the flat out loan worked out at the same price but reduced the monthly payments and made buying the MINI more comfortable with less equity wrapped up in the car. More affordable leaving more cash for other things!

[NeuroBeaker]

Quote: Originally Posted by 1 AJC (original)

According to the salesman at my local dealership, 95% of the customers finance their car through MINI select. Is this really the case? what are the real benefits of it? I was initially planning to buy outright, but the salesman tried pretty hard to sway me from this, noting that the money would be better off earning interest in a bank. Quite true, but surely the fact that the cost for the finance will be far more substantial is more offputting.

Somehow I don't think you're going to earn more interest in the bank than the MINI Select scheme will earn from you. When I was ordering my ONE in early 2004, it was actually a 21st birthday present / University gift from my parents - so the car was going to be paid for using cleared funds.

However, the salesmen kept trying to push finance deals on me and convincing me that the best option was to get it on credit, pay low monthly rates, and change the car every two or three years. Well, if you only want to buy one car and want to keep it much longer than that, then this is a terrible deal.

In the end, they brought it up so often and I found myself politely declining so frequently that I ended up saying:

"I want the car, but I don't want you finance deal - it's a lot of hassle having to say 'no' to you every five seconds. Mention credit arrangements to me again and I'll take my order to another dealership."

Funnily enough, they never brought it up again after that. All other aspects of the sale were great, but I do think salesmen are instructed to push the credit contracts.

So, in conclusion, if you were planning on buying the car outright to start with, then I'd stick to that plan and don't let the salesmen pressure you into a financial commitment you don't really want or need.

All the best,
Andrew.

[Tigger, Eeyore & Roo]

Nice story ARCrawford,

The Select Finance deal is brilliant for the dealership as it changes the way people think about buying cars. Instead of making payments with a view to owning a car outright, what could be better than getting people used to the idea of a regular monthly payment and then automatically changing the car for a new one every couple of years?

I don't imagine that the salesman will make a worthwhile commission on the sale of the finance scheme, but it will build up a useful "book" of virtually guaranteed upgrades that should make his or her life much easier within just a couple of years.

It's much easier for a sales person to stay in control when there is the imminent propsect of their car returning to the finance company and a large bill for excess mileage turning up or, alternatively, a large balloon payment invoice arriving in the customer's post one morning. As each car comes to the end of it's finance period it will be much harder for the customer to "dither about" / procrastinate and the route of least resistance for the customer will simply be to say "yes" and sign a new finance deal.

The schemes certainly have their uses for some customers (I Love MINI, Laura seems to be playing the game to her advantage!), but I can certainly see why dealers and sales people would like to see more of them!

Tigger.

PS: I work in sales! You can guess, can't you?!

[NeuroBeaker]

Quote: Originally Posted by Tigger, Eeyore & Roo (original)

It's much easier for a sales person to stay in control when there is the imminent propsect of their car returning to the finance company and a large bill for excess mileage turning up or, alternatively, a large balloon payment invoice arriving in the customer's post one morning. As each car comes to the end of it's finance period it will be much harder for the customer to "dither about" / procrastinate and the route of least resistance for the customer will simply be to say "yes" and sign a new finance deal.

I hadn't thought about it quite like that - very crafty! And I thought it was just the interest rates they were after.

Theeeeeeeee wonderful thing about Tigger,
Is that he explains wonderful things:
The finance deals that confuse us,
And turn dealers into Kings,
They're tricky, tricky, tricky, tricky, tricky sorts of things!

The wonderful thing about Tigger is that he's a helpful one.
Heeeeeeeeee's a helpful one!

Woohoohoohooooooo!

All the best,
Andrew.