Ford Credit has launched a new motor finance product aimed at 'cash-rich' customers who can put down large deposits.
Under the scheme customers make no monthly payments during the two- or three-year agreement period other than the initial down payment. At the end of term, as with a conventional PCP, they have the option to buy the car for a Guaranteed Minimum Final Value (plus option to purchase fee), sell the car and pay the GMFV, or hand the car back to the supplying dealer.
The CashPlan scheme was launched to Ford dealers last month and is also available through Volvo Finance. It is the first significant new retail motor finance product to be launched since Ford introduced Options back in 1993.
The initial down payment is calculated by deducting the GMFV from the total cost of the car to create a balance and any interest due on the GMFV then added to the balance to create a one-off sum. Customers can use their existing part-exchanges to make the down payment so, in some cases, no cash would change hands.
To launch the scheme Ford is charging initial interest rates as low as 5.9% APR on Fiesta and 6.9% APR on current model Focus for two-year agreements. The promoted rates apply until the middle of December. Volvo Finance is charging just over 11% until the end of December.