Surely the dealer is only offering VW finance and thats around 6% APR on a Golf - is he manipulating the figures and talking 'flat rates'? I would be very suspicious!!
I generally find that salespeople at dealerships rarely understand the ins and outs of finance. All they understand is the monthly figures, and not how they got there. They seem to drive the deal by how low they can get the monthly payment or how many more extras they can squeeze into your monthly budget without going over it. They ask you how much you can afford per month rather than brokering the deal with discounts on the car and then letting you know what the monthly cost is. They also like to mix up flat rate and APR a lot which can mislead the customer (although I do believe that some of them genuinely can’t tell the difference, so maybe misleading isn’t always their intent.
I have a good relationship with my salesman I’ve had for the last 2 cars. When I go in there he knows I only want to know 3 things – my part-ex price, the GFV and the cash cost of the car itself after negotiated discount. From that he knows that I’ll be able to tell him what that’ll equate to on a monthly basis within a couple of quid of what his computer will say if I go the finance route (which I didn’t this time). The GFV figure also gives an idea of what your part-ex value should be worth at 3 years old.
Look into what is going on in your financial quote – car, part-ex, extras which you may or may not have specified. Some add GAP/Autoglym etc to every quote as a matter of course and then leave them in unless you tell them otherwise.
I doubt very much you’re getting 2.9% APR – that even seems a little low as a flat rate misquoted as APR and the dealerships are obliged to go through VW finance as far as I’m aware. Perhaps they’ve “saved you” the equivalent of around half the interest in discount on the car (total interest on an R should be somewhere in the region of about £3600 on standard example terms).
