New tractor, which model to choose

[Cowabunga]

So how come i have 20k borrowed over 2 years at 5.7% and when you add up the 24 monthly payments of £877 its only £1048 interest.

Because you took a totally different form of finance, probably from a bank, possibly with a significant downpayment and/or for a small proportion of the total value of whatever it was. Plus, of course, it is only for two years, which lowers the risk and raises owner equity substantially. You have also probably got an excellent credit rating. Believe me, plenty of people are often paying 5% flat on equipment.

 

[Lakesdigger]

60k at 5% flat over five years… simples...

60k*5% = 3000*5years =£15,000 of interest.
60k+15k=75k/60months=£1250/month. That is for a typical five year at 5% flat finance figure for an used tractor. Of course a bank loan is potentially much cheaper. The bounce-back loan for instance is a fraction of the interest.

I'm not arguing with your figures as such just that from my experience you don't pay the 3k interest every year just in total over the 5 years (so 600 per year).
Yes mine is different on a new machine and significant down payment. Through an independent broker not bank.
I will say if you were to be 100% financing a piece of machinery to either need to looking a guaranteed income from it or you're paddling up the creek

 

[michael N123]

I'd sooner have a Valtra than a fudging Massey.

New 8s looks good tho

 

[fieldfarmer]

60k at 5% flat over five years… simples...

60k*5% = 3000*5years =£15,000 of interest.
60k+15k=75k/60months=£1250/month. That is for a typical five year at 5% flat finance figure for an used tractor. Of course a bank loan is potentially much cheaper. The bounce-back loan for instance is a fraction of the interest.

Why would you sign up for flate rate interest, paying interest on money you repaid some 4 yrs earlier, mine 3 Yr old tractor, borrowed 24 k for 24 months, monthly repayment £1049, set up fee only. Interest =£1176.

 

[Boycey]

60k at 5% flat over five years… simples...

60k*5% = 3000*5years =£15,000 of interest.
60k+15k=75k/60months=£1250/month. That is for a typical five year at 5% flat finance figure for an used tractor. Of course a bank loan is potentially much cheaper. The bounce-back loan for instance is a fraction of the interest.

I can confirm that this is the correct calculation for a flat rate HP agreement... The flat rate is the rate of interest charged on the initial balance, charged for each year that the loan is in place. All vehicle HP agreements are calculated using this method. The best flat rates in the market are currently around 4-5%. Lower rates than this are available but they will be subsidised rates, generally only available on new equipment. A 5% flat rate over 4 years generates a quoted APR of 10%.

The key advantage with any HP agreement is that loan is secured to vehicle. This avoids diminishing any theoretical borrowing capacity with your bank and can be timed to match the likely lifespan of the vehicle. There are also various regulations relating to HP agreements designed to protect the purchaser and making it more difficult for the lender to repossess the asset in the event of a default.

 

[ollie989898]

New 8s looks good tho

Be a brave bloke that buys one of those this early on though.

 

[Rob Graham]

https://www.facebook.com/llansilintractors/posts/4264754596884343

Potentially a nice purchase for someone, would imagine a fair discount compared to a D7 8S.205

 

[Cowabunga]

I can confirm that this is the correct calculation for a flat rate HP agreement...

I am amazed at the number of doubters. Shocking really that so many don't know how HP agreements work.

 

[fieldfarmer]

I am amazed at the number of doubters. Shocking really that so many don't know how HP agreements work.

Because you can get non flat rate for monthly payments.

 

[Cowabunga]

Because you can get non flat rate for monthly payments.

APR is generally worked out mathematically from a flat rate on HP.

 

[fieldfarmer]

APR is generally worked out mathematically from a flat rate on HP.

The difference on my quote for 24 monthly repayments or 2 annually so a 0 + 1 +1 was staggeringly different, sadly do not have the other quote here.

 

[Cowabunga]

The difference on my quote for 24 monthly repayments or 2 annually so a 0 + 1 +1 was staggeringly different, sadly do not have the other quote here.

Of course it would be.

 

[B R C]

Flat rate is just a tactic used by the finance industry to make interest rates look lower than they really are. Always ask what the apr is as that is the real interest rate, and it is usually nearly double the flat rate. The ducks 6% flat is nearly a whopping 12% apr which is ridiculous.

 

[Cowabunga]

Flat rate is just a tactic used by the finance industry to make interest rates look lower than they really are. Always ask what the apr is as that is the real interest rate, and it is usually nearly double the flat rate. The ducks 6% flat is nearly a whopping 12% apr which is ridiculous.

5% flat is fairly typical for used equipment if not 6%, as Boycey above has confirmed .

I've seen some finance rates from Close Brothers for a contractor with a poor credit rating that was up in credit card territory and even refinanced a cleared tractor at that rate to give as a deposit on it and the new tractors. These were two new tractors that the subsidised finance provider refused to finance.
I've seen it all!

 

[FrasseSweden]

Keep us updated when you get it

Absolutley i shall give a update when i got it.

 

[Boycey]

Flat rate is just a tactic used by the finance industry to make interest rates look lower than they really are. Always ask what the apr is as that is the real interest rate, and it is usually nearly double the flat rate. The ducks 6% flat is nearly a whopping 12% apr which is ridiculous.

The flat rate is the true rate of interest being charged. The APR rate is typically double the flat rate. The reason there is a difference is because the APR takes account of the diminishing balance on loan over time where as the flat rate is the % amount charged annually based on the starting balance. APR will vary according to the term of the loan and balance being financed. Flat Rate remains the same always hence the name. Agricultural Machinery HP agreements are usually unregulated hence there is no requirement to quite the APR. Passenger Cars are usually sold with regulated HP agreements this means your local dealership is obligated to inform you of the quoted APR.

A 10% APR might seem expensive when looking through the optic of rate comparison sites etc but it is important to note that vehicle HP agreements offer a great deal more consumer protection than bank lending products. A common misapprehension is to assume that lowest rate must be therefore better. I have encountered many folks in my work life insisting that they will finance their vehicle purchase using a mortgage extension as they can get a 2% rate as opposed the 10% HP offer... Completely overlooking the fact that 2% over 25 years amounts to a vast amount more interest paid than 10% over 4 years...

 

[puntabrava]

For the 8S
The space and quietness in the cab. The radiator fan which draws air from the cab end and blows it out of the front, which is a major advance for dusty and chaffy front mounted work. The massively increased number of large brake disks and stopping power. The visibility. The new Datatronic system, which has always led the market is further improved and refined. The camera integrated camera system.
These are just a few things I've learnt about it so far while acknowledging I haven't seen one in the metal.
The JCB uses the same brand of engine and transmission of course, although a new improved CVT will be a while coming to the 8S, although it is going to be offered. Again the JCB has a new spacious cab and a still unbeatable ride.

These are a generation ahead, possibly up to five years ahead of the opposition as overall packages currently. They are not just mild refreshes or styling and spec upgrades of previous models. They are the basis for the next decade's upgrades at least.

Let’s hope the Massey is more reliable than the Jcb.