My advice is to ask the salesman to put all the figures down into an email, and ask for him to explain them in simple terms.

I've just signed up for a Juke and did all the negotiations by email. Once you know the model you want, just email a few local dealers and ask for their best price to change.

There's nothing much to fear from finance deals from the main dealers.

Look at HJ guide on finance

http://www.honestjohn.co.uk/guides_finance/

My simple guide

1)Cash - you own car

2)HP - Deposit + payments say over 24/36 mths = you own car at end of contract

3)Personal lease - small deposit, 24/36/48 Rental payments - you do not own the car UNLESS you pay the Balloon Payment @ end (GMFV etc) or you just hand back car. You can be held liable for bumps and scrapes if you hand car back at end. If you break the contract early (say 20 mths) there are termination charges which are substantial + bumps scrapes scratches etc

4) Bank loan - you buy car with borrowed money but you own the car from day one.

You can buy from any source so you could buy from discount broker and not your local main dealer price.

Options / PCPs work well if the car in question holds its value well (you may get a deposit towards the new one, as explained above, but more importantly the monthly payments can be lower). SWMBO has had three Minis on PCPs with good deals on all of them.

But I wouldn't buy a Ford or a Vauxhall new (or a Vauxhall at all) - they depreciate too fast too soon and the bargains are to be had secondhand.

The waters might not clear on this one.

My personal opinion is...

Depreciation is the biggest single cost with a car under 5 years old. This is an elephant in the room that is rarely spoken about because it makes dealers and the industry nervous.

Would you put £20k in the bank and 3 years later be happy that it was worth £10k? That is what happens when you put your cash into a new car.

If you PCP (options, whatever its called with a balloon at the end) you put down a deposit (£1.5k perhaps) and then finance the depreciation. You may have paid £12k over three years but you have £18.5k in the bank still and the opportunity cost of doing what you want with that money. If you lose your job the £18.5k in the bank will make the payments (and pay the mortgage), if you put £20k into a car then it doesn't and you might have to fire sale.

Yes with finance you pay interest but if you chose the right car and the right deal (Toyota do PCP on cars up to 5 years old) then you can get a decent deal.

I would not bother with a PCP on a cheaper car. We have an i10 and after the deposit of £1k and 3 years of £99 or so the balloon was something like £4k - the monthly payments had not reduced the final payment by much more than £500. We bought that outright instead, but if you can't do that a straight loan would be best (consider a 5 year loan, even if you only want to keep the car 3 years as the final 2 years payments will be about the same as a balloon). Rule of thumb is each £5k borrowed over 5 years is £100 per month, sensible PCPs seem to average the same over 3 years but leave you a balloon to pay.

The Saab I bought on a PCP and terminated at 34 months (no penalty) because the car was worth £3k and there were £7k worth of payments still to make (equivalent) to keep the car. Lesson - cars that depreciate heavily should be avoided OR bought after they have done most of their depreciation. I suggest a new Ford may fall into this category.

I have just bought a 3 year old RAV4 on a PCP. Again we could have bought it outright but I prefer to keep the money in the bank (well, ISA).

You can Google for an Excel spreadsheet that will allow you to play with PCP figures and APRs. Study the figures and consider the deal. I went to a car supermarket who had a year old RAV4 that was 2.5k cheaper than my new A3 was but having put down a larger deposit the monthly payments were £80 more than the A3. They didn't want to tell me the APR - I walked.

I have learnt to be dispassionate about car financing and think of it like a normal business asset purchase. The car becomes a utility, just transport like a washing machine is just to wash clothes or a computer is to compute, and consider the finance options accordingly.

I am not dispassionate about the cars I chose however!!! That said, if someone had told me at the start of 2009 I would go from a Saab 93 to Audi A3 to Subaru Legacy to RAV4 with a Mazda 323 becoming a Hyundai i10 I would have laughed at them....