Dealer Products

PCP

Personal Contracts Purchase offer your customers complete flexibility, allowing you to tailor the repayments to suit your customer’s budget.

PCP is similar to a Hire Purchase contract but instead of paying off the entire value of the car in monthly instalments, your customers defer the expected future value (Guaranteed Minimum Future Value GMFV) of the car until the end of the agreement. The customer therefore pays a portion of the borrowing.

This has the benefit of reducing the customer’s monthly repayments meaning they can often afford to purchase a higher value or newer vehicle than they first expected.

The Guaranteed Minimum Future Value (GMFV) will vary depending on the period of the agreement and predicted annual miles.

Pinnacle Financial Contracts have partnered with leading independent PCP providers and can offer our dealers and customers the following benefits compared to the manufacturer scheme

• 24 to 60 month agreements
• Brand specific PCP campaigns to compliment manufacturer offers
• Brand specific residual value analysis
• Up to 5 year old cars at inception
• Upfront, spread and no fee options
• Online proposal submission

Personal Loan

A personal loan does not give the finance company title to the asset, nor does it afford the customer certain rights that a Hire Purchase agreement would.

Personal loan products are used by Pinnacle Financial Contracts to predominantly lend on vehicles where the advance exceeds the industry values recommended by two automotive valuation guides, Glass’s and CAP.

Customer’s wishing to add on products or who have negative equity from their part exchange can be offered a personal loan product as an alternative solution to them having to find additional deposit or simply not being able to complete the purchase.

Pinnacle Financial Contracts work with multiple personal loan providers to ensure that we have the most comprehensive offering and product choice for our dealer partners and their customers.

• Low rate campaigns
• Vehicles up to 12.5 years old at the end of the agreement
• No LTV restriction
• Product sales can be on invoice
• Negative Equity can be split out on invoice
• Add on sales opportunities can be maximised
• No need to remove insurance products

Negative Equity

Negative equity is one of the biggest barriers to customers replacing their current cars, and one of the most difficult hurdles for salesman and dealerships to overcome.

Negative equity arises when the part exchange settlement is greater than the part exchange value.

Since the credit crunch in 2008, consumer finances have become more strained. Generally less money is available for deposits, repayments periods have extended to 60 months and capital repayments reduced by residual value products. These factors all add up to more and more customers finding themselves in negative equity and therefore all dealers need to have effective solutions to this problem.

Most mainstream and manufacturer finance houses have restrictive loan to value policies and refuse to knowingly finance negative equity, however strong their credit profiles.

Pinnacle Financial Contracts can finance the replacement car and all the negative equity, however large, with one transaction at a prime interest rate.

Simply show the correct sale price and the settlement less the part exchange value and the negative equity on your invoice. There is no vat liability in hire purchase negative equity, providing it is shown separately on your invoice.

Your sale is vat compliant, will maintain your profit margins, and the transaction is fully funded at a competitive customer rate.

• New car and part exchange negative equity consolidated into one transaction
• Low customer rates
• No loan to value limitation
• No need to inflate retail sale price
• Reduces your vat liability on the sales margin
• Maintains chassis profit and increases finance commission opportunity
• No need to hide negative equity from the lender
• No risk of vat non compliance
• Simple invoicing
• Makes dealing customers easier
• Your sales team will sell more cars
• Add on sales and insurance opportunity is maximised

VAT implications on used cars

The conventional, dealer solution has been to add the hire purchase negative equity on to the retail price of the car being sold, and in so doing over value the part exchange.

This creates a needless vat liability for the dealer which has the effect of reducing profit. Our negative equity solutions avoid these pitfalls.

Military Finance

This is a competitive and unique facility, which is tailored to serving or retired UK personnel and their immediate families of the three services i.e. the Army, the Royal Air Force, and the Royal Navy. No matter where your customers are stationed, at home or abroad Pinnacle can help. Because the lender is a specialist Armed Forces provider, they understand the military lifestyle, which most mainstream lenders’ credit scoring systems fail to understand.

• All serving or retired military personnel and their families considered
• Bespoke, manual underwriting, not reliant on credit scoring
• No voters roll trace, not a problem
• No previous credit history, applications still considered
• Credit limits approved by rank, not just credit history or age
• Loan terms from 12 to 60 months

Finance Lease

Finance Lease offers customers all the benefits of owning assets without the downside. You pay a fixed monthly rental and at the end of the agreement when the asset is disposed you typically keep 95% to 98% of the proceeds.

Less deposit required. This product is particularly beneficial for customers buying commercial vehicles. A typical deposit is just three rentals in advance which is usually less than the VAT due on the sale price of the vehicle, as required for Hire Purchase.

Reduced monthly instalments. The payments are calculated on the VAT exclusive price so monthly rentals are lower.

Flexible payments. The rentals can be tailored to suit the customers budget. On a fully amortised lease, the rentals are an equal amount. However, the monthly payment can be reduced by including a final residual payment to help aid cash flow.

Effective budgeting. The interest rate is fixed at the start of the agreement, so despite possible fluctuations in bank interest rates, the monthly rental stays the same.

Reduces tax. VAT is paid on the rentals, not the purchase price. Monthly rentals can be off set against taxable profit.

Disposal. If you want to keep the vehicle at the end of the agreement, you can by simply paying a small annual rental. If you want to sell or part exchange the vehicle at the end of the agreement you will receive between 95 – 98% of the sale proceeds which can be used to acquire your next vehicle.

This product is for business users only.